Effect of Lending Innovation on the Financial Performance of Listed Commercial Banks in Kenya
Keywords:
Financial Innovation, Financial Performance, Lending Innovation, Listed Commercial BanksAbstract
Commercial banks have quickly recognized that lending innovation is a viable strategy for expanding formal financial services into the unbanked regions of the country, such as urban, rural or marginalized areas. In this regard, banks have continued to deploy huge investments in financial-based innovations and manpower training to handle the new technologies. However, despite the numerous innovations that banks have adopted, a portion of them have kept on encountering a decline in market value, causing them to merge with others. Therefore, the purpose of this study was to ascertain the effect of the lending innovation on the financial performance of listed commercial banks in Kenya. The study adopted descriptive and correlational research designs. Twelve staff members from each bank were purposefully selected. The study utilized a questionnaire to collect primary data. The study assessed the validity of the study instrument using construct validity and content validity. To measure reliability, the Cronbach's alpha technique was employed. For statistical analysis of quantitative data, SPSS software version 22 was utilized. The results revealed that lending innovation had a significant positive effect on financial performance (β1=0.138, P=0.002). The study concluded that lending innovation has a significant positive effect on financial performance. The study recommended that listed commercial banks in Kenya should prioritize investment in lending innovation to enhance financial performance. This includes adopting innovative lending practices and technologies to improve service delivery and customer experience.
Published
How to Cite
Issue
Section
Copyright (c) 2024 Naomi Jelagat Kosgei, Ondiek Benedict Alala, Muli Maingi
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Most read articles by the same author(s)
- Jacob Wafula, Muli Maingi, Dennis Bulla, Effect of Credit Monitoring Practices on Loan Nonperformance among Microfinance Institutions in Nairobi County, Kenya , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Jamgun Jensen Iravonga, Prof. Benedict Ondiek Alala, Muli Maingi, Consolata Ngala, Effect of Integrated Financial Management Information Reporting System on Financial Management in County Governments, Kenya , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Jamgun Jensen Iravonga, Consolata Ngala, Benedict Ondiek Alala, Muli Maingi, Effect of Integrated Financial Management Information Revenue Systems on Financial Management in County Governments, Kenya , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Aggrey Kadima, Mary Nelima Sindani, Muli Maingi, Credit Risk Management on Financial Performance of Selected Microfinance Institutions , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Sophie Shitemi, Muli Maingi, Robert Egessa, Effects of Exchange Rate on Performance of Equity Funds in Kenya , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Collins Wekesa Wanjala, Consolata Ngala, Muli Maingi, Effect of Government Capital Expenditure on Tourism Sector Growth in Kenya , African Journal of Empirical Research: Vol. 4 No. 2 (2023): Jul-Dec 2023
- Peruce Hoka Etenyi, Mary Nelima, Muli Maingi, Effect of Credit Risk Management Techniques on Financial Performance of Deposit Taking SACCOs in Kenya , African Journal of Empirical Research: Vol. 5 No. 4 (2024): Oct-Dec 2024