The Role of Digital Payment Systems in Financial Inclusion: A Study of Mobile Banking Adoption in Kenya

Abstract

Purpose: This study examines the role of mobile banking in enhancing financial inclusion in Kenya, with a particular focus on the impact of mobile banking adoption on access to financial products, financial behaviors, and overall economic participation.

Subjects and Methods: Using a cross-sectional quantitative research design, data were collected from 450 adult respondents across urban and rural regions of Kenya. Descriptive statistics, chi-square tests, regression analysis, and t-tests were used to analyze the data.

Results: The results show that mobile banking users have significantly higher access to savings, credit, and insurance products compared to non-users. Moreover, mobile banking adoption is positively associated with improved financial behaviors, including more frequent saving and borrowing. Demographic factors such as age, income, and education were found to significantly influence mobile banking adoption, while gender did not play a significant role. Barriers to adoption, such as security concerns and lack of awareness, were identified as key challenges.

Conclusions: The findings highlight the transformative role of mobile banking in fostering financial inclusion, while also pointing to areas where targeted interventions can further improve access to mobile financial services in underserved populations.