ASSESSMENT OF THE OPPORTUNITIES AND CHALLENGES OF MOBILE BANKING: CASE STUDY OF DASHEN BANK OF ETHIOPIA

Abstract

The purpose of this study is to assess the challenges and opportunities of mobile banking in Dashen bank of Ethiopia with specific objective of assessing the current practices on both customers and the bank side, benefits and challenges realized by the bank and customers, the driving forces and opportunities in the bank for the adoption of mobile-banking . An exploratory research design was employed to conduct this study. Both primary and secondary data were collected for the purpose of this study. The collected data was analyzed by using SPSS, descriptive analysis such as table graphs and percentages. The findings of this study revealed that Dashen banks mobile banking offers services like Fund transfer, balance inquiry, bill payment, mini statement, checking account history, merchant payment, account information, alerts on account activity, check book request, status and payment, deposit and withdrawal by using short messaging and client based channels. From this services the majorities of customers use services like deposit, withdrawal, money transfer and checking account information. Attracting high value customers, increased revenue, enhanced image, larger customer coverage, cost reduction, improvement of organizational efficiency, deposit mobilization are the main benefits the bank realized and time saving, 24 hr access and physical security are the main benefits on the customers side. The main challenges that Dashen bank face when using the technology according to the finding are Network availability, security challenge, operational challenge, Chances of risk, customer’s literacy and network problem, language problem, menu navigation, understanding and hardness of making payment are challenges on the customers side. The driving forces which initiate Dashen bank to adopt the technology are Deposit mobilization, revenue generation, to facilitate transaction, Existence of high competition in the banking industry, Existence of high demand, Desire to improve organizational performance, Desire to improve the relationship with customers, Desire to reduce transaction cost, Desire to cover wide geographical area, Desire to build organizational reputation, Desire to satisfy customers. The existing opportunities for the adoption of mobile banking are high penetration of mobile phone, widening network coverage, Commitment of the government to strengthen the banking industry, the level of technology, country development, Commitment of the government to facilitate the expansion of ICT infrastructure, infrastructural development of the country, the existence of high demand and Increment of educated potential customer.