Rural customer electronic banking services adoption: experiences from NMB bank plc customers in rombo district, Tanzania

Abstract

Customer preference for e-banking is a contextual concept, and how it manifests itself varies from a person to person, product to product and service to service. A variety of psychological, economic, socio-demographic, physical and firm-related factors influence service selection and utilisation. Because of the differences that exist in societies, the determinants of customers' choice of e-banking services have been a source of contention. The issues of whether or not rural populations use available e-banking services, as well as the extent and who uses them require context-specific responses. This study specifically determined the proportion of customers’ adoption on electronic banking services; established factors that determine adoption of electronic banking services among NMB Bank Plc customers in Rombo District as well as the reasons for usage. A cross-sectional research design was employed and 282 respondents were reached through a survey questionnaire using convenience sampling technique. The qualitative data were analysed through content analysis while binary logistic regression was employed to establish the determinants of customers’ e-banking adoption. The study revealed that, among other things, that automatic teller machine cards were the most commonly used e-banking platform (91.8%) and credit cards were the least commonly used (1.2%) e-banking service. In general, e banking was used moderately (49.7%) in the study area. The regression results confirmed that age, education level, ethnicity, occupation and level of income were the strongest predictors of e-banking adoption. Moreover, the multiple response results indicated that convenience (26.4%), time savings (26.1%), and cost effectiveness (20.7%) were all likely factors in customers' decision to use e-banking services. Given the findings, it is suggested that banks, in partnership with the Government, take the lead role in promoting e-banking, safeguarding consumers' personal data, and charging appropriate costs to clients.