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Joshua Mahasi Lubanga - Master of Business Administration, Laikipia University, Kenya

Thomas Gakobo - School of Business (Department of Commerce) Laikipia University, Kenya

Prof. Isaac Ochieng - School of Business (Department of Commerce), Laikipia University, Kenya

Dr. Lawrence N. Kimando - School of Business (Department of Commerce), Laikipia University, Kenya


This study is on factors influencing adoption of e-payment system in public transport sector in Kenya with specific focus on matatus operating the Nairobi-Kitengela route. The study contended that the introduction of cashless payment system in the matatu industry in Kenya to enhance accountability by removing direct cash was not successful. The matatu owners and other stakeholders through a legal injunction successfully petitioned the government to delay implementation of the e-payment system. Ever since, it was not clear to what extent matatu stakeholders have implemented the e-payment system for the same reasons cited by the Government or for other reasons. The study was guided by the following objectives; to determine the extent to which human skills, the cost of ICT, and compatibility of technology used or to be used influenced adoption of e-payment by matatu plying Nairobi-Kitengela route. The study was guided by three theories: technology acceptance model; diffusion of innovation theory; and technology, organization, and environment context theory. The study was an exploratory study. The total population of the study was the stakeholders in the public transport sector in Kenya, whereas the target population was the operators of companies and Savings and Cooperative Societies (SACCOs) operating public transport business on the Nairobi-Kitengela route. A sample size of 195 respondents was chosen for this study, representing 25% of the target population, with 85% response rate registered. Simple random sampling procedure was used to select the general respondents. Key informants who comprised 20 representatives of the matatu management were purposively sampled. An observation checklist was used to ascertain any evidence of adoption of e-payment system.  Statistical Package for Social Sciences (SPSS) version 20 was used to analyze the data which was then presented using percentages, frequency distribution tables, charts and graphs.  Qualitative data was analyzed using qualitative methods where relationships between variables were noted and the findings reported in narrative form. Finally, logistic regression analysis was used to explain the relationship between the dependent and independent variables. The study found out that introduction of e-payment system is in line with matatu industry policy, according to a larger percentage (41.0%) of the respondents who agreed. It was similarly observed when the respondents were asked about the possible positive changes to be introduced in the industry by e-payment systems, with 42.8% and 5.4% agreeing and strongly agreeing that e-payment shall impact positively. In addition, there was a near consensus among the respondents that e-payment system in the matatu industry would increase efficiency, with 41.0% agreeing and 4.8% disagreeing. However, more than half (51.2%) of the respondents did not know whether information channels and networks on knowledge generation for technology adoption was well understood in the industry. Finally, the respondents agreed (59.6%) that there are miscellaneous costs involved in the adoption of e-payment by the matatu companies. Thirty-six point one Percent (36.1%) and 11.4% of the respondent said that availability of finance and credit policy was important in the acquisition of e-payment systems in the matatu industry.

Full Length Research (PDF Format)