An Evaluation of Agency Banking Services Adoption in Centenary Rural Development Bank (Cerudeb).
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Date
2023-11-30
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Makerere University Business School
Abstract
The study examined the factors affecting the adoption of agency banking in Centenary Rural Development Bank (CERUDEB) in the Central Region of Uganda. Specifically, the study sought to establish the supervisory measures CERUDEB has put in place for agency banking, identify factors affecting the adoption of agency banking, and examine initiatives undertaken to improve agency banking adoption among customers. The study was guided by the Agency Theory and adopted a quantitative approach using a cross-sectional research design. The study population comprised 5,800 CERUDEB agents, from which a sample of 357 respondents was determined using the Krejcie and Morgan (1970) sample size table. Data were collected using structured questionnaires and analysed using the Statistical Package for Social Sciences (SPSS Version 23) through descriptive statistics. The findings revealed that CERUDEB had established several supervisory measures to support agency banking operations. These included daily reporting by agents, routine supervisory visits, recording of transactions for monitoring purposes, reporting of complaints, depositing excess funds at supervising branches, and registration of agents. The overall mean score of 3.879 indicated that supervisory measures were moderately implemented, although some areas required further improvement. The study further established that the major factors affecting agency banking adoption were security concerns, inadequate cash availability among agents, unreliable network connectivity, frequent downtime of agent machines, and limited trust between customers and agents. The overall mean score of 4.561 showed that these factors significantly affected the adoption of agency banking services. The study also found that key initiatives for improving agency banking adoption included customer orientation on the use of agency banking, enhancing security systems against cyber threats, ensuring constant availability of funds for agents, improving agent training, strengthening physical security, and improving agent branding. These initiatives recorded an overall mean score of 4.005, indicating strong agreement among respondents regarding their importance in increasing adoption. The study concludes that while CERUDEB has implemented supervisory mechanisms that support agency banking operations, challenges related to security, liquidity management, technology infrastructure, and customer trust continue to limit wider adoption. The study recommends strengthening agent supervision, improving security systems, enhancing cash management support for agents, investing in reliable network infrastructure, and increasing customer awareness and training to promote greater adoption of agency banking services.
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This is a master's thesis.
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Citation
Muganga, D. (2025). An Evaluation of Agency Banking Services Adoption in Centenary Rural Development Bank (Cerudeb). (Unpublished master's dissertation). Makerere University Business School, Kampala, Uganda.