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Victoria Tatu Simon - Master of Business Administration in Strategic Management, Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Thomas A. Senaji, R. Eng - Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya


In the bid to catch up with global developments and improve the quality of service delivery, it is in no doubt that banks have  invested much on technology, and have widely adopted electronic and telecommunication networks for delivering a wide range of value added products and services. However, the integration of customers into electronic banking is far from been realized. The general aim of the study was to determine the effect of electronic banking and customer satisfaction among first tier bank in Nairobi Town. The study was hinged on diffusion innovation theory and contrast theory. The study adopted a descriptive survey research design. The target population was 262511 customers drawn from 5 first tier banks within Nairobi CBD. Stratified sampling technique was used to select a sample size 225 respondents. Primary data was collected using structured questionnaires addressed to the participants. The researcher conducted initial data analysis using descriptive statistical measures. The study also conducted a regression analysis to establish the relationship between the study variables. From the findings, the study concluded that flexibility of internet banking influence customer satisfaction to a great extent. In addition, many customers use internet banking because it is easy to use while personalized internet banking also affects customer satisfaction to a great extent. The study further concludes that usefulness of internet banking and friendliness of internet banking has relatively low effect on customer satisfaction. The study also concludes that convenience of mobile banking affects customer satisfaction to a great. Further, the study concluded that user friendly ATMs, ease of access of ATMs and privacy of ATMs affects customer satisfaction to a great extent. In addition, using ATM cards in supermarket and affordability of ATM charges have moderate effect on customer satisfaction. In relation to point of sale system, the study concludes that, effectiveness of point of sale system affects customer satisfaction to a great extent. Finally, it was clear that mobile banking has the highest effect on Customer satisfaction followed by automated teller machines, then point of sale system while internet banking had the least effect on customer satisfaction. Banking institutions should enhance their internet banking to make it flexible, fast and easy to use. Management of banking institutions should enhance application of mobile banking to increase satisfaction of their customers. Mobile service providers in conjunction with banks should develop more friendly and easy to use and efficient applications for bank customers. Finally, the banking institutions should work hand in hand with major retail outlets and other organizations that use point of sale systems so as to ensure the cards issued to customers and point of sale systems are useful, reliable and can work with speed. 

Full Length Research (PDF Format)