THE ROLE OF MOBILE MONEY ON SAVINGS MOBILIZATION BY BODA-BODA YOUTHS IN WOTE TOWN, MAKUENI COUNTY

Abstract

Mobile phone adoption has made financial services available to youths through a mobile channel. This has empowered youths to meet many day‐to‐day financial transaction needs through a mobile phone. Although Kenya as a country has undergone tremendous financial reforms in the last decade, its financial sectors remain undeveloped compared to the standards of developed countries. Financial exclusion among the youths is more evident in Kenya as indicated by the global data base. As indicated by FSD-K only a fifth of youths has a bank account with a financial institution. The general objective of this study was to determine the role of mobile money on savings mobilization of boda-boda youths in Wote town. The specific objectives were: to find out the role of mobile money deposits, transaction costs, mobile loans and mobile money regulations on savings mobilization of boda-boda youths in Wote town. The study used a descriptive survey design. The study targeted a population size of 16,621 and a sample size of 384 boda-boda youths in Wote town. The study used primary data. Data was collected using a questionnaire. Descriptive statistics, Pearson correlation analysis and chi-square analysis was used to analyze the data. The study established that mobile money deposit was an important factor influencing savings mobilization of boda-boda youths (r = 0.956, P-value = 0.000); the study also established that transaction cost is an important influence on savings mobilization of boda-boda youths (r = 0.388, P-value = 0.000); further the study established that mobile loans are an important influence on savings mobilization of boda-boda youths (r = 0.356, P-value = 0.000) and finally the study also established that mobile regulations are important influence on savings mobilization of boda-boda youths (r = 0.256, Pvalue = 0.000). All the four null hypotheses were tested using Chi-square analysis, where all the hypotheses were rejected based on the Chi-square values. There was perception from the respondents that savings mobilization of boda-boda youths was influenced by mobile money deposits, transaction costs, mobile loans and mobile money regulations. The study therefore concluded that for effective savings mobilization among boda-boda youths mobile money providers should enhance mobile money deposits by proving various deposit accounts, offer affordable mobile money transaction costs, enhance mobile money loans. Also, the study concluded that mobile money regulators should enhance savings mobilization by increasing the daily transaction limits. The study recommends that for effective savings mobilization among boda-boda youths, mobile money providers should enhance mobile money deposits. The study also recommends that mobile money providers should consider offering affordable mobile money transaction. The study further recommends that mobile money providers should consider offering mobile loans at affordable cost and finally the study recommends that mobile money regulations should be enhanced through knowledge dissemination. The findings will go a long way in informing appropriate policies and actions need to enhance savings mobilization among boda-boda youths through mobile money.