Factors Influencing the Use of Agency Banking among Entrepreneurs: A Survey of Businesses in West Pokot Sub-County

Abstract

Over the years the banks have faced challenges in trying to bank the unreached especially in rural areas. Micro Finance Institutions have been handy in mobilizing savings from the people in rural areas and ensuring that they can access credit whenever there is need. The success of micro finance institutions made the banks be innovative and try to tap into this market segment through appointing third parties to provide the banking services on their behalf. This study aimed to look into factors influencing the use of agency banking among entrepreneurs in West Pokot sub-county. It concentrated on all businesses- both small and large. West Pokot sub-county attracted just a few agent bankers who offer the banking services to clients. The sampling method used was convenience sampling to pick a total of 50 entrepreneurs from the seven major market centres spread across West Pokot sub-county. Data was collected by means of questionnaires and mainly analyzed by use of frequencies, tabulation and percentages. Pearson's chi square results (p = 0.344) showed that there was no significant relationship between education and use of agency banking services. Costs were found to affect the use of agency banking. It also found that awareness levels about agent banking positively influenced the use of agent banking. Businesses were however found not able to access all the banking services at the agents.