Agency Banking and Accessibility to Financial Services of Commercial Banks in the Northern Province of Rwanda

Abstract

This research project was on assessing the effects of agency banking on accessibility to financial services in commercial banks in the Northern Province of Rwanda. The study adopted a descriptive research design. The population was 555 agents under which sample size was 233 people found using the Yamae formula. The study used a stratified and simple random sampling method. Also, different research instruments of data collection were used which include: journals, articles, document analysis and questionnaires. The reliability of the study was tested by carrying out pilot research and found that Cronbach's Alpha of .831. The data was analyzed using SPSS version 21 and data was presented using tables, percentages, means, and standard deviations. To analyze the relationship between two variables, Pearson Chi-Square and Pearson correlation were used to come up with comprehensive results. It was clear from the study that strategic responses to the implementation of agency banking as a competitive strategy in enhancing customers’ access to financial services included the provision of high-quality customer service, enhancing the operational structure and improving the brand image. The study established that operational structure, brand image and financial services awareness among the rural population are positively correlated (r = 0.805) with access to financial services. Access to financial services was greatly enhanced by strategically increasing the proximity of agency banking services, increasing the number of services that could be offered through agency banking and increasing awareness among the population on financial services available at agency banking outlets. Keywords: Agency banking, Financial Services, Commercial banks, Customers, Rural population.