Understanding Mobile Banking from a Theoretical Lens: Case Studies of Selected Kenyan m-Banking Products

2. Problem Statement

Even though the telecommunications and financial service industries share important traits, they have some fundamental differences that partnerships can help overcome. Telecoms need certain capabilities in order to provide wireless finance services. Those they do not already possess, they can acquire relatively cheaply by allying themselves with banks, and the combination can create competitive advantage with the right regulations (Wouter et al, 2010). Despite these mergers between financial players and telecommunication companies promising to address financial exclusion particularly those associated with access and business volume; positive effects especially of the transformational nature are yet to be realized because partnerships in Kenya have been rocky (M-kesho (CBK, 2012) M-shwari, KCB-M-pesa among others¹). Consequently take up of mobile banking products targeting poor and marginalized populations has been low as less than 1% of total digital transactions among low income households are digital (CGAP, 2015). Furthermore there is a tendency by actors to channel lots of effort on innovations that are additive as opposed to those that address financial inclusion². So what ails the relationships in mobile banking and what needs to be done to stabilize these networks for sustained service delivery? Who are the actors in mobile banking? What are their roles in the emergent mobile banking networks? These are the questions that guided the research reported in this paper.

The specific objectives of the paper were to ascertain the usefulness of the Actor Network as a framework for informing trends in mobile banking and to determine the role of actors in the design, roll out and use of mobile banking products for financial inclusion.