Firm Characteristics and E-Commerce Usage in the Kenyan Banking Industry

Abstract

The aim of this study was to investigate the firm characteristic drivers that influence e-commerce usage in the Kenyan banking industry. Despite clear evidence showing that e-commerce usage is moderated by local environment, drivers influencing e-commerce usage remains under-researched particularly in Kenya. This objective of the study was to determine the influence of market share, number of employees, Top management support, organization learning ability and bank ownership on e-commerce usage in the Kenya banking industry. Grounded on the Technological, Organizational and Environmental model (TOE), five hypotheses were tested in the study to determine the drivers of e-commerce usage. A descriptive cross- sectional survey was carried out and the population of the study was all the 43 commercial banks operating in Kenya as at December 2013. A sample of 32 banks was selected using stratified random sampling, while purposive sampling was used to select 96 respondents who participated in this study. Primary data was collected using a questionnaire that was administered to the heads of ICT, Operation and Finance departments of the selected banks. Data analysis was carried out using Statistical Package for Social Sciences (SPSS) and coefficient of determination and regression analyses was undertaken to test the hypothesis. Results showed that Top management support, organization learning ability were significant factors determining use of e-commerce while firm size, bank ownership and number of employees were not. The study adds to existing innovation literature suggesting that firm characteristics influence usage of ecommerce applications in Kenyan banking industry and confirms effectiveness of TOE framework for conducting studies on actual technology usage at the firm level