Information Asymmetry and Usage of E-Banking Transactions Through Mobile Phones in Commercial Banks

Nicholas Gregory Okello, Anywar Thomas, Judith Awacorach


Technological advancement has led to implementation of some innovative products and/or services like electronic banking by rural commercial banks targeting the rural customers who have completely no bank branch available. This study presents an investigation into information asymmetry and usage of e-banking transactions through mobile phones. The study adopted a cross-sectional survey design and used a mixed method approach to collect data from 114 clients. The results obtained revealed that the level of information asymmetry regarding e-banking through mobile phone was relatively low at only 32% of the bank customers in the rural areas having knowledge of e-banking services offered by commercial banks. Similarly, the level of usage of e-banking transactions through mobile phone was low, whereby only 34% of the commercial bank customers in the rural area are using the e-banking services through mobile phones. Albeit, the result further revealed that there exists a positive and statistically significant relationship between information asymmetry and usage of e-banking transactions through mobile phone at 95% confidence level. The study recommends that there should be periodic educational campaigns to address information asymmetry and usage of e-banking through mobile phone by the banks to promote customer patronage through erosion of the fear and negative perception that customers have concerning e-banking services and its use.

Keywords: information asymmetry, e-banking, mobile phones, rural commercial banks

DOI: 10.7176/JMCR/92-05

Publication date: January 31st 2024

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