Effects of Mobile Banking on Financial Performance of Equity Bank

Abstract

In recent years, financial institutions have embraced mobile banking, which has revolutionized their operations and those of other firms. This research sought to determine the effects of mobile banking on the financial performance of Equity Bank. The specific objectives were to determine the financial performance of Equity Bank, to find out the most mobile banking products contributing to the overall financial performance of Equity Bank, to find out the contribution of mobile banking to the overall financial performance, and to determine the mobile banking major strengths, weaknesses, opportunities, and threats. The target population was the employees of Equity Bank. A sample size of 30 employees was selected by stratified and simple random sampling methods from 10 branches of Equity Bank in Nairobi. The data collection was done using a questionnaire. The results were presented in tables with descriptive measures. The results showed that ROE of Equity Bank was 26.1% and ROA was 3.5% in 2022, which increased from the previous year, 2021. The Equity bank had an outstanding financial performance with large profits to which mobile banking products significantly contributed. It was found that Equity Bank produced mobile banking products such as equitel sim cards, which positively influenced financial performance. The major strength of mobile banking was easy to use, and the main weakness of mobile banking was network downtime. The opportunity of mobile banking was accessibility and reliability, while the major threat of mobile banking was found to be hacking. The study recommended that policymakers should reconsider mobile banking in their design of policies due to its expansion and effectiveness. Equity Bank should continue using mobile banking in its operations because mobile banking is one of the ways by which Equity Bank has generated its revenues and has attracted more customers to use its services and products, which has increased its financial performance. However, Equity Bank needs to take more strenuous measures to eliminate the threats of hacking and minimise network downtime. More strategies should be taken by the management of Equity Bank to effectively continue facing the main competitors.