The Effect of Mobile Banking on Commercial Bank Performance Case Study: Post Bank Wandegeya

Abstract

The main objective of the study was to find out the effect of mobile banking on the commercial performance of banks in Uganda and the case study was Post Bank Uganda at Wandegeya branch. For this research, primary data were used and was descriptive in nature.

The methods used to collect data through self- administered questionnaires with close ended questions, interview guide and observation. The data collected was analysed qualitatively and quantitatively. The study was also backed by literature review on m- banking technology in Uganda.

The total of 35 questionnaires were issued to the staff of Post bank Uganda and 32 were returned within which all the 91% respondents think that it saves time compared to traditional banking, and some of the respondents use mobile banking for Payment of bills , Air-time top-up service and others.

The introduction of customer friendly services by the bank such as mobile banking, internet banking and Mobile payments among others as a way of delivering convenience services to customers has become common in the recent years as a way of gaining competitive advantage and maintaining customer loyalty and increase share in order to improve the performance of the banks.

The study main objectives were; to examine how Mobile phone banking (transactions) affects commercial bank performance in Post Bank (Uganda),to explain how internet banking has affected the performance of Post Bank (Uganda) commercial bank and to examine how Mobile/electronic commerce has affected commercial bank performance in Post Bank (Uganda).

The study findings indicated that one need to register with the bank and maintain an account with both the bank and telecom company such as MTN to be able to access mobile banking services. The services offered by Post bank Uganda include; Account Balance inquiry, Fund Transfer between Accounts, Bills payment (utility bills) among others. The introduction of mobile banking in Uganda has contributed to profitability, liquidity and clientele base (customer loyalty) which has influenced the commercial performance of banks. Therefore there is a relationship between mobile banking and commercial bank performance.

Conclusion and recommendation were looked at as a way of strengthening the contribution of mobile banking and commercial bank performance. The researcher recommends that mobile banking services have the power to create opportunities for the rural poor by increasing financial security and reducing the cost of transactions. It also supports the informal methods of acquiring money that could be alleviated through loans that are remitted directly via mobile financial services. Mobile banking services can also stimulate the performance commercial banks in Uganda.

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