AGENCY BANKING AND FINANCIAL INCLUSION; A CASE OF KENYA COMMERCIAL BANKS IN SIAYA COUNTY
Abstract
The purpose of this study was to establish the role of agency banking in promoting financial inclusion in Siaya County, focusing on all the banks currently employing agency banking in the county i.e. KCB, Equity and Cooperative Bank. For the attainment of this goal, the study was guided by these specific objectives: to ascertain the role of agency banking model’s cost-effectiveness in promoting financial inclusion in Kenya commercial banks in Siaya County; to analyze the extent to which agency banking saves time for customers and agents and improves financial inclusion for Kenya commercial banks’ customers in Siaya County; to determine how agency banking changes serving hours and promotes financial inclusion for Kenya commercial banks’ customers in Siaya County; to establish agency banking’s role in promoting financial inclusion through increasing convenience levels of obtaining agency banking products in Kenya commercial banks in Siaya County. Descriptive research design was applied to address the research problem. Besides, the paper’s target population encompassed a sample of the regulated Kenya commercial banks’ agents in Siaya County. For the selection of respondents from this target population, the study used the sampling method. To collect data, the paper predominantly relied on questionnaires, comprised of closed-ended questions, in the data-gathering exercise. For the data analysis process, the study utilized multiple regression analysis, and the central tendency measures, including standard deviation, mean, and frequencies. Finally, tables were utilized in the findings’ presentation. The study realized a posive relationship between agent banking and financial inclusion. The time saved, serving hours and convenience had a positive and significant influence on financial inclusion in commercial banks in Siaya County. The transaction cost had a negative and significant effect on financial inclusion in commercial banks in Siaya County. This study recommended that the banks should raise awareness of these services and offer them at a cheaper price to encourage their use in order to ensure the adoption and usage of agency banking services. The bank management must regularly review their agency policy in order to expand the number of agents and so enhance financial inclusion. The study also recommended that the agency operators should utilize the maximum serving hours possible which would increase financial inclusion as the operators will serve many customers and increase their income as well.
Key Words: Agency Banking, Financial Inclusion, Banks
CITATION: Dimbia, A. A., & Wanjohi, F. M. (2023). Agency banking and financial inclusion; a case of Kenya commercial banks in Siaya County. The Strategic Journal of Business & Change Management, 10 (1), 219 – 238.
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DOI: http://dx.doi.org/10.61426/sjbcm.v10i1.2534
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