INSTITUTIONAL INNOVATIONS AND FINANCIAL INCLUSION AMONG RURAL HOUSEHOLDS IN UGANDA,
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Date
2024-03-03
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Global scientific Journals
Abstract
This study was carried out to ascertain the impact of institutional innovations by commercial banks
on financial inclusion in the Kabale district. The specific goal was to ascertain the relationship
between institutional innovations and financial inclusion, among rural households. The study used
both descriptive and cross-sectional research designs combined qualitative and quantitative
methods for data collecting and analysis. Using questionnaires and interviews, data was gathered
from a sample of 396 respondents as well as additional important informants. Microsoft EXCEL
and SPSS Version 21.0 were used to analyze the data and produce both descriptive and inferential
statistics. The study also found a correlation between institutional innovations and financial
inclusion, including interbank funds transfer systems (rs = 0.683, p= 0.002), partnerships with
different financial intermediaries (rs = 0.288, p= 0.004), legal frameworks (rs = 0.878, p= 0.001),
and liquidity availability (rs = 0.956, p= 0.000). The study's findings support the statistically
significant link between commercial banks' institutional innovations and rural families' access to
credit. As more clients choose mobile banking, the report advises banking institutions to develop
measures to improve security in the platform. The report also advises making these platforms
straightforward and simple to use in order to attract more users to the business. Additionally,
because mobile banking has an impact on financial inclusion, banks should make sure to support
mobile banking services by incorporating mobile phone usage as one of their innovations.
Description
Keywords
Institutional Innovation, Financial Innovations, Financial Inclusion, Commercial Banks.