Cost of Banking Transactions Through Agency Banking as a Competitive Strategy: A Case of Kenya Commercial Bank in Nakuru County, Kenya (original) (raw)
The need for a competitive strategy was informed by the intense competition in terms of profitability and market share of the different banks. Agency banking is the new innovation that banks are using to take services to the un-banked and under-banked at a cheaper rate as the concept takes customers out of the bank halls to kiosks and villages. The objective of the study was to examine the cost of banking transactions through agency banking at Kenya Commercial bank as a competitive strategy. The theoretical framework was based on the financial intermediation theory and Porter's competitive strategies theory. The research design of the study was the descriptive survey design. A sample size of 236 respondents derived through the Yaro Yamane formula was used. The stratified sampling method was used to get representative sample members from each of the KCB branches. The study also used structured questionnaires as the data collection instruments. The research findings were analysed through SPSS and the results presented in tables. The descriptive statistics that were used include the frequency distribution and chi square. The study concluded that agency banking has become an important delivery channel for financial services to aid operational costs of banks and also to actualize the goal of competition. It recommends that banking institutions come up with lock in strategies for the already captured market to help them control the prices and services they offer customers.
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