Thesis:

Influence of online banking on financial performance of banks in Kenya: a case of Kenya commercial bank

Customers of banks and other financial institutions can conduct a range of financial activities using web-based technologies through online banking, commonly referred to as virtual banking. The primary goal of this study is to evaluate the effect of online banking on Kenyan commercial banks' financial performance using the Kenya Commercial Bank as the case study. The specific goals of the study include, evaluating the influence of online cash management; Online payment of bills; Online account management and international funds transfer on financial returns of KCB Bank in Kenya. The target population will comprise of 126 management staff across different cadres at KCB bank. Sample size of 95 respondents will be used representing the targeted staff of the bank. Questionnaire are used to collect data and the data is cleaned, processed and analyzed using statistical analysis software of (SPSS) version 26. The survey had a good response rate of 93.7% of the 95 questionnaires that were distributed. The majority of the staff who participated in the survey were male (55.06%) while the minority were female (44.97%). The study also showed that age bracket 36-44yrs are majority (39.33%) while age bracket 18-26yrs are the minority. Employees with Bachelor’s Degree are the majority (49.44) and middle management job description had the greatest (43.84%) number of employees. Normality test is done and all the variables are normally distributed. Regression analysis is done and the results show that Online banking has a positive influence on the financial performance of Kenya Commercial Bank. The survey established that Online banking accounts for 14% of the financial performance of KCB. However, including the mediating variable; Economic performance, online banking accounts for 32% on the financial performance. The research recommends that local and foreign commercial banks concentrate on using evolving technologies designed to facilitate online banking in order to fulfill their objectives. The Kenya Commercial Bank should improve strategies that boost economic performance such as creating adequate and equal job opportunities, generating revenue for the country, looking for international investors and supporting the government agendas. Implementing these strategies would help the bank improve its financial performance.