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Impact of Online Banking on Financial Performance of Commercial Banks: A Case Study of Barclays Bank of Kenya

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dc.contributor.author Ali, Asha Ahmed
dc.date.accessioned 2019-02-05T08:11:30Z
dc.date.available 2019-02-05T08:11:30Z
dc.date.issued 2018
dc.identifier.uri http://erepo.usiu.ac.ke/11732/4273
dc.description A Research Project Report Submitted to Chandaria School of Business in Partial Fulfilment of the Requirements for the Degree of Masters of Business Administration (MBA) en_US
dc.description.abstract The purpose of this study was to investigate the impact of online banking on the financial performance of commercial banks in Kenya. The study specifically focused on Barclays Bank of Kenya. To what extent does accessibility of Online Banking impact financial performance of Commercial banks in Kenya? To what extent does Online Banking Risk Management Strategies impact financial performance of Commercial banks in Kenya? To what extent has online banking impacted profitability of Commercial banks in Kenya? The study adopted descriptive research design where financial performance of Barclays Bank of Kenya was analysed for the six year period 2012-2017. Furthermore, primary data was sourced from two branches of the Barclays Bank of Kenya, that is, Moi Avenue Branch and the Queensway Branch. 50 respondents composed of bank managers, departmental heads and employees were selected for the study. Stratified random sampling was used to choose the respondents. Primary data was collected with aid of questionnaires which was later analysed using the Statistical Package for Social Sciences (SPSS) and excel in finding descriptive statistics: frequencies, percentages, mean, standard deviation, kurtosis and skewness. Regression analysis between independent variables and dependent variable was performed in order explore the forms of relationships between the two variables. The results were presented in form of tables and figures. Study findings revealed that online banking accessibility factors were positively correlated to financial performance. Regression results indicated that only 35.0% of the variation in return on assets (ROA) of commercial banks could be explained by the variations in accessibility of online banking. Furthermore, findings suggested that all financial performance parameters had positive correlations with online banking risk management strategies. Also, the findings on regression revealed that only 17.6% of the variation in return on assets (ROA) of commercial banks was explained by the variations in the risk management strategies of online banking. Lastly, the findings suggested that financial performance parameters had negative correlation with online banking fees and commission with exception of EPS. And only 37.6% of the variation in return on assets (ROA) of commercial banks was explained by the variations in fees and commission of online banking. The study concludes that ease of accessibility, fees and commission and risks associated with online banking are increasingly impacting on the profitability of commercial banks. The study also notes that security of internet banking and mitigating strategies for online banking threats are reaping positive benefits to the financial performance of commercial banks. The study also realised that fees and commission involved in mobile banking has a statistically significant influence on the financial performance of commercial banks. The study suggests that banks should provide their customers with convenience, meaning offering service through several distribution channels (ATM, Internet, physical branches) and have more functions available online. The also study recommends that while this study did not find any significant effect of internet banking risk management practices on the performance of banks, commercial banks should invest in better interest risk management practices in order to reduce risks banks needs to conduct a lot of research on internet risks and make viable investments in all its online functions and operations. Educating customers on the best approaches to tackle internet risks could also be vital. The study recommends that much research should be conducted to determine the effectiveness of adopting online banking in commercial banks. Additionally, similar study should be conducted in the region of East Africa market to ascertain the findings. en_US
dc.language.iso en en_US
dc.publisher United States International University - Africa en_US
dc.subject Online Banking en_US
dc.subject Financial Performance en_US
dc.subject Commercial Banks en_US
dc.subject Barclays Bank of Kenya en_US
dc.title Impact of Online Banking on Financial Performance of Commercial Banks: A Case Study of Barclays Bank of Kenya en_US
dc.type Thesis en_US


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