Information technology and competitiveness of Commercial Banks in Kenya

Abstract

This main objective of the study is to analyze the adoption of information technology and competitiveness of commercial banks in Kenya. To achieve the main objective the study established the extent of adoption of information technology by commercial banks in Kenya, determine whether the extent of adoption of information technology by commercial banks in Kenya is related to bank competitiveness and determine the challenges faced in adoption of information technology by commercial banks in Kenya. The study adopted a descriptive research design. The population of study consisted of all the registered commercial banks in Kenya. Purposive sampling in which chief Information Communication Technology (ICT) managers at the headquarters of each of the commercial banks in Kenya was applied in the study. Data was collected using questionnaires and analysis was done using Statistical Package for Social Sciences (SPSS) for quantitative data while content analysis was used for qualitative data. Descriptive statistics (frequencies, mean and standard deviations) and multiple regression models was generated using SPSS and the findings were presented using tables and charts. From the findings, the study found that commercial bank’s overall performance was influenced by information technology adoption in specifically marketing, credit, finance, Information Communication Technology departments, customer relations and human resource departments. The study revealed that adoption Information Technology enhanced competitiveness as it enabled the bank to practices had retail-banking, automated banking and other financial services, and retain customers through strengthening customer relationships. The study recommends that commercial banks should do a research for developing information technology and guidance to promote its positive competitive advantage.