A comparison of customer behaviour and retention pre and post cellphone banking adoption in South Africa.

Date
2014-07-28
Authors
Jhina, Anjali
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Abstract
STRACT The South African retail banking industry is highly competitive and dominated by ABSA, Standard Bank, First National Bank and Nedbank. Recently, Capitec Bank has also managed to gain traction in the industry. Banking channels have evolved significantly from the traditional bricks and mortar channels to the more evolved digital self-service channels (Automated Teller Machine (ATM), Internet banking) in recent times. The mobile banking channel is one of the newer channels that has entered the banking industry and has been in existence for approximately six years now. Earlier studies on mobile banking concentrated mainly on perception-based studies that looked at adoption factors influencing the customer’s propensity to take up the channel. Fewer studies have been done on the actual impact that mobile banking take-up has had on customer behaviour. Additionally, there’s a widely-held view that the take-up of mobile banking has a positive impact on customer retention. There is hence a dual purpose that this study intends to address. Firstly, a comparative study on the transactional behaviour (number of transactions and the value of transactions) performed by customers pre and post adoption of cellphone banking has been performed. Secondly, an analysis of the impact that cellphone banking has had on customer bank account retention was also conducted. Two data samples have been used to address each of the two components of transactional behaviour and retention. Data from one of the big four banks was extracted, cleaned and analysed using parametric and non-parametric data analysis techniques. Key findings included the identification of the factors influencing customer transactional behaviour in the pre and post phases of adoption. Results of the study showed that customer transactional behaviour increased with the adoption and usage of cellphone banking. Factors such as age, gender, race and income revealed significant changes in means for a number of metrics which are described in the study. Another noteworthy finding included the positive impact that multi-channel banking had on customer bank account retention. The findings of this study help banks realise the value of the cellphone banking channel and justify investment in mobile delivery technologies.
Description
MBA 2012
Keywords
Banks and banking, Consumer behavior, Cell phones, Electronic commerce.
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