Kenya post and savings bank as a preffered strategic partner by commercial banks in the implementation of agency banking in Kenya
A strategic alliance involves at least two partner firms that: remain legally independent after the alliance is formed, share benefits and managerial control over the performance of assigned tasks; and make continuing contributions in one or more strategic areas, such as technology or products. The objective was to evaluate Post Bank as a preferred strategic partner by commercial banks in the implementation of agent banking in Kenya. This research was conducted based on the Case Study as a research tool. This study relied on the use of primary data carried out through an interview guide. The study established that there were several key drivers to setting up the strategic partnership. All these were meant to cope with the stiff competition in the market by increasing their foot prints across the country more so by increased customer uptake and improved levels of satisfaction for its existing customers that would result in the growth of their market share and profitability. On the other hand the strategic alliance partners found it cheaper to partner with Post Bank as opposed to setting up their own agents. By partnering with Post Bank, the strategic partners rode on post bank’s already existing information technology platform that eased the installation link of communication between the partners. Besides the installation costs, the post bank staff were well trained and conversant with the system lowering the cost of training on the partners. The availability of suitable space and openness to post bank’s co-branding preferences fundamentally acted as a cost reduction factor to the partners leading to the partnership between post bank and the commercial banks. The study further concludes that the banks experienced challenges that included frequent system down times which affected the operations at post bank its partners and led to frequent long queues in the banking halls. There were also system integration challenges as some systems of strategic alliance partners were not compatible with those of post bank delaying the kickoff of some partnerships. Differences in strategic intent between post bank and its partners also served as a major challenge in the implementation of the partnership. This study therefore recommends that post bank and its partners invests innovative products so as to improve the level of customer satisfaction, loyalty and the overall impact and success of the partnership. The study therefore recommends that future research be carried out to determine factors affecting the choice of agent banking partner selection in Kenya to help find out how commercial banks go about selection of agents in Kenya.