AGENCY BANKING AND SERVICE ADOPTION BY CUSTOMERS IN FINANCIAL INSTITUTIONS IN MBARARA CITY

Abstract

Globally customer adoption is challenging with commercial banks introducing new products in the name of agency banking. This study covered five chapters as described below; Chapter one: This chapter presents background of the study, statement of the problem, purpose of the study, objectives of the study, scope of the study, significance of the study, theoretical frame work and conceptual frame work. Chapter two: This section presents the related literature on empirical studies. It begins with a theoretical review under which a number of related theories are presented. Later empirical literature is presented thematically. The literature in this study is reviewed based on empirical works and studies by other research scholars regarding; - factors contributing to the low number of agents of agent banking, the level of withdraws on agent banking, and the number of clients making payments through agent banking. The study assessed the effect of agency banking on service adoption by customers in Equity Bank in Mbarara City. It was guided by the following objectives; to examine the indicators of agency banking, to establish the level service adoption by customers and to determine relationship between agency banking and service adoption by customers. Chapter three: This chapter presented the methodology for the study which included the research design, target population, sample size and selection, sampling techniques, data collection methods and instruments, data quality control (validity and reliability), data analysis, measurement of research variables, ethical considerations and limitations. This study adopted a case study research design. Quantitative data was collected from the respondents. A sample of 132 respondents were selected from a population of 200 respondents. Collection data relied on questionnaires. Quantitative data was expressed in quantitative terms that which deals with numbers, measures out comes in terms of figures. Chapter four: This chapter covered the presentation, analysis, and interpretation of the findings of this study on agency banking and service adoption by customers in financial institutions in Mbarara City; A Case Study of Equity Bank. Specifically, this chapter presents background findings, descriptive and inferential results. This was presented according to study objectives; the xiii indicators of agency banking, the indicators of service adoption by customers, and relationship between agency banking and service adoption by customers. The data collected was edited and coded into a form usable by Statistical Package for Social Scientists (SPSS) data analysis package from which tables with variable frequencies and percentages were drawn for easy analysis. The study findings revealed that there were effective agency banking services for Equity Bank as evidenced overall mean score of 3.8. There was good service adoption by customers with overall mean score = 3.82. There was a statistically significant relationship between agency banking and service adoption by customers in financial institutions at P = 0.006 < 0.05. Chapter five: This chapter presents discussion of findings, conclusions and recommendations for the study as follows; It was recommended that the management of Equity Bank should ensure that perceived trust is given utmost importance in a bid to improve adoption of agency banking. The government need to put in place regulations‟ that will effectively ensure customer security and confidentiality at the agent location. The Equity Bank should continue to sensitize customers and the wider public on the use of agency banking and its benefits.