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ELECTRONIC BANKING STRATEGIES AND COMPETITIVE ADVANTAGE OF COMMERCIAL BANKS IN KENYA
In the current turbulent, highly competitive contemporary business environment, bank managers are under pressure to implement strategies that will achieve their banks optimal competitiveness. Among the strategies they are largely applying in their pursuit for competitive advantage are electronic banking strategies. However, amidst the banks venturing into electronic banking strategies to maintain their competitiveness, they still have major challenges confronting their competitiveness. It is therefore imperative to interrogate these strategies and their impact on banks’ competitiveness, for these strategies to be streamlined accordingly. Unfortunately, few studies have interrogated the influence of EBS on the banks’ competitiveness. Existing literature thus lacks sufficient insights for decision making. The motive of this study was to interrogate the EBS and their influence on the banks’ competitive advantage in Kenya. It was undertaken using the descriptive cross sectional survey design. By applying a census approach, the entire Kenyan commercial banks were covered. Data was obtained by use of a questionnaire filled by the head of strategy or finance in each of the banks or their assistants. Descriptive statistics and inferential statistics were used for analyzing the data. Results indicated that internet banking, mobile banking, and ATMs have a significant correlation (r) with competitive advantage with r values of 0.678, 0.524 and 0.437 respectively. Use of POS machines was found to have an insignificant correlation of 0.308 with competitive advantage. The research concludes that mobile banking, internet banking, ATMs and POS machines have a positive influence on competitive advantage. However, the influence by POS machines is statistically insignificant while mobile banking, internet banking and ATMs have a significant influence on competitive advantage. It is recommended that banks invest in educating their clients on how to access different services from their diverse e-banking channels. Moreover, they should adopt more innovations on e-banking to ensure that a diverse category of customers are able to access services through e-banking.
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