The role of mobile deposit in deposit mobilization

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The Role of Mobile Deposit in Deposit Mobilization in Ghana

Article ? November 2013



1 author: Francis Appiah-Kubi Banson Wisconsin International University College, Ghana 2 PUBLICATIONS 10 CITATIONS




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ISSN: 2047-2528

Asian Journal of Business and Management Sciences Vol. 3 No. 03 [01-18]


Francis Appiah-Kubi Banson Department Of Business Studies, Graduate School Wisconsin International University College, P.O. BOX LG 751, Accra-Legon, Ghana E-mail: fabanson@

Emmanuel Sey Department Of Business Studies, Graduate School Wisconsin International University College, P.O. BOX LG 751, Accra-Legon, Ghana E-mail: ed_sey@

Jonathan Sakoe Finance Department University of Mines and Technology P.O. BOX 237, Tarkwa, Ghana. E-mail: Sakoe@

Francis Appiah-Kubi Banson (Corresponding author) Department Of Business Studies, Graduate School Wisconsin International University College, P.O. BOX LG 751, Accra-Legon, Ghana E-mail: fabanson@


The main objective of this study is to identify the role mobile deposits play in deposit mobilization with the high rate of mobile phone penetration in Ghana. The study used stratified, convenience and purposeful techniques to arrive at the sample size and descriptive statistics for the presentation and analysis of findings. The findings show that mobile deposit as a way of deposit mobilization through mobile banking has proven to be very effective means of mobilizing deposit apart from the traditional usual way of deposit mobilization. As a result, First Capital Plus, the first financial institution to introduce this product in Ghana and Africa at large has been able to increase its deposit base tremendously. It is a 24 hours a day 7 days a week service which makes it convenient for customers to deposit money anytime anywhere. It has reduced queuing at FCP's banking halls, encouraged the culture of savings especially among low income earners, reduced the risk associated with carrying money to the bank to deposit and reduced the time and cost of travelling to the bank to deposit money. The mobile deposit solution through the use of Speed Banking Cards has proven to be a complementary deposit system.

Keywords: Mobile banking, mobile deposit, speed banking, e-banking, mobile commerce, e-commerce


Mobilization of deposit for a bank is as essential as oxygen for human being, (Deb, K. 1988). Deposit mobilization is one of the main functions of banking business and so an important source of working fund for the bank. Deposit mobilization is the collection of cash or funds by a financial institution from the public through its current, savings, fixed, recurring accounts and other specialized schemes. Since deposits are normally considered as a cost effective source of working fund, the bank's ability to lend more as well as its success greatly lies on its deposit mobilization. However the bank's ability to mobilize enough funds

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ISSN: 2047-2528

Asian Journal of Business and Management Sciences Vol. 3 No. 03 [01-18]

from the public through its current, savings, fixed, recurring accounts and other specialized schemes will depend on the systems employed in this highly competitive industry, (Digaria, H. A. 2011).

Banking over the years has lived up to its definition of safe keeping of customers funds and ensuring that the customers get the money upon demand. And this has been the basic function of banking just as a raw material is for a business; to banking institution is cash. Cash mobilization therefore the world over has continually been part of the primary and important component of banking. In both retail and corporate banking, this important aspect of banking has been practiced in different forms with the commonly known aspect being direct deposit by the customer in the banking hall. Withdrawal of cash is also made in the banking halls or any permitted premises as approved by the bank or financial institution.

Technology has become an intrinsic part of banking, making it easier and cheaper to develop and deliver financial services. As a consequence of the highly technological environment developed around the world in the banking industry, the expansion of distribution channels for financial services relies on a very complex network of partnerships (Robert Weissbourd, Rw Ventures With Perpetual Motion, Inc. June 2002). At the same time, in developing countries, only part of the population has access to basic financial services, such as a deposit account, for example. A number of studies ( Claessens 2006; UNDP 2007; and others) have claimed that technology will play a significant role in improving poor people's bank access, taking financial services in a sustainable way too far and underserved locations. There is a tremendous opportunity for banking technology to connect lower-income citizens at reduced costs and bring millions of consumers to the formal financial marketplace through electronic channels (Robert Weissbourd, Rw Ventures With Perpetual Motion, Inc. June 2002). With the incorporation of innovation and technology, many aspects of banking has been automated and improved. Through innovation, customers have seen easy and accessible means of banking and have to a greater extent helped banks reach out to many of the unbanked population. With the support of technology, tedious processes of banking have been reduced and services have improved. Some innovations could be mentioned of the bulk cash collection by team of bank staff to key clients of the banks with bullion van; the use of mobile bankers to market and collect cash from petty traders and others clients of the banks; and the selling of nonbanking products such utility bills, bank assurance, sale of passport forms and registration of booking dates for visa to the embassies. Technology in the banking industry saw the introduction of internet banking; SMS banking, automated teller machines (ATM), and the introduction of mobile money.

The emergence of mobile commerce in recent years as a new branch of E-Commerce has attracted the attention of the world. This rapid advance in technology has brought about growth and development of this type of commerce. Meanwhile, Mobile Banking is one of the main branches of Mobile Commerce, which influences the other fields of this commerce considerably, European Journal of Economics, Finance and Administrative Sciences - Issue 28 (2011). In order to survive in the competitive environment of modern banking, banks need to consider the optimal management of costs of using various technologies, and incur minimum costs using best practices. Applying Mobile Banking greatly reduces the banks' costs. On the other hand, it provides customer satisfaction because of ease of access to financial transactions anywhere in any time with only a cell phone instead of waiting in a queue at the bank. The term "Mobile Banking" refers to application of cell phone as a channel to provide banking or financial services. It is a platform for the delivery of financial services via the mobile phone. Mobile banking is an application of m-commerce which enables customers to access bank accounts through mobile devices to conduct and complete bank-related transactions such as balancing cheques, checking account statuses, transferring money and selling stocks ( Kabir R.M, 2012). Mobile banking is an innovative method for accessing banking services via a channel whereby the customer interacts with a bank using a mobile device (e.g. mobile phone or personal digital assistant (PDA) (Abadi et al, 20013).

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ISSN: 2047-2528

Asian Journal of Business and Management Sciences Vol. 3 No. 03 [01-18]

Mobile Banking services got a growing trend ahead so that economic experts predict that by 2013, 300 billion transactions worth over 860 billion dollars will be done through mobile banking (Rogers, 1983). Mobile Deposit refers to application of cell phone as a channel for customers to deposit money into their bank account using their cell phones without physically going to the bank or financial institution to deposit the money. This will help address walk in deposit and non-banking hours. Walk in Deposit is where a customer of a bank or a financial institution goes to the premises of that institution during working hours to pay money into his/her account. Non-Banking Hours refers to periods where banks do not open their banking premises to do business with their customers. For example, In Ghana, banks close their banking halls to the public after 16:30 hours GMT to the next day 08:30 hours GMT from Monday to Friday. In addition to Sundays and Saturdays but on a few open to the public on Saturday for some few hours. Cash mobilization as the foremost activity of a bank or any financial institution requires that it gets as much as it can so as to loan out or invest and this has seen banks and other financial institutions employ different means to mobilize as much funds as they can. It is therefore no surprise that Ghana Commercial Bank has acquired deposit taking automated teller machines (ATM's) to be deployed in the second quarter of 2013 across the country to accept deposit from customers (Myjoyonline news, August 22, 2012). Under this score that innovation and technology can make the means possible. The focus of the study is to explore systems which are being used today different from what used be in the past in deposit mobilization in the financial sector of the Ghana hence the Speedbanking system (mobile deposit) from First Capital Plus.

First Capital Plus (FCP) is a wholly-owned Ghanaian Savings and Loans institution. The company commenced operations as a savings and loans institution on October 29, 2009. This marked a major transition in operations, having operated for two years as a financial NGO specializing in micro finance. As a savings and loans institution, the company is authorized to provide a wide variety of banking service to the public including checking accounts, savings accounts, investments, e-banking services such as ATMs, SMS Banking, electronic bill payments, funds transfers etc. It operates in four regions having 12 branches and 1 agency; Spintex, Tesano, Newtown, Makola, Ashiaman, Osu, Dansoman, Kasoa, Kumasi, Takoradi, Cape ? Coast, Koforidua and Abossey Okine. In June 2011, First Capital Plus launched its SMS Banking service (branded Speed-Banking) and commenced its innovative flagship 24hour Cash Deposit service. SpeedBanking (SB) allows customers to deposit cash directly into their bank accounts in real time through an SMS (text message), anywhere, anytime, any day using their cell phones and a scratch card called speedbanking card (SBC). FCP's strategic objective for Speed-Banking is to revolutionize banking by expanding its frontiers to include a large section of the unbanked population. ( August, 2012).


To construct a framework for deposit mobilization through mobile banking and mobile deposits, the study considered five factors referred to as the Extended Theory of Planned Behavior (ETPB), Lin Hsiu-Fen (March 2010), which will enable the adoption of mobile deposit by customers. Most previous researches in the field of electronic banking have focused mainly on the technology adoption based on planned behavior model. Shih and Fang 2004 in particular have done comprehensive studies on individual's beliefs, attitudes, perceived behavioral control and subjective norms, and the impact those factors have on user's behavioral intentions. However, most studies conducted in the field of electronic banking adoption models, an important factor such as quality and properties of electronic banking services on which mobile banking is defined, is not considered.

Accordingly, five factors related to mobile banking services (information quality, transaction speed, ease of use, the bank's reputation and security of the mobile network) referred to as the Extended Theory of Planned Behavior (ETPB) was looked at and the study also considered factors such as queuing in the banking hall, nonbanking hours, cost and time used to travel so as to understand some factors which will drive customers to adopt mobile deposit as alternative to other forms of deposit.

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ISSN: 2047-2528

Asian Journal of Business and Management Sciences Vol. 3 No. 03 [01-18]

2.1 The quality of information

Given the increased potential of mobile banking in the business process, many companies and users are using cell phones as an alternative sales channel. Therefore, researches have shown that the quality of mobile-based operational processes plays an important role in perceived quality of products and services offered through mobile-based services. Since the mobile has become a big arena in the process of marketing and business transactions, so users expect to receive clear and accurate information through this technology. Therefore, if financial institutions can assure the quality and accuracy of financial transaction information in mobile deposit then it will be easy for consumers to adopt mobile deposit as an improved way of saving money.

2.2 Speed of transactions

Emergence of technology-based electronic services constitutes the emergence of new methods of trade and financial transactions. In this case, customers are able to conduct many financial transactions directly and without involving bank employees. If customers could save some of the time spent visiting and queuing in banking halls provided mobile deposit will speed up financial transactions customers will be glad to adopt.

2.3. Ease of use

Given the expansion of the use of mobile banking services, customers inevitably will have to receive their financial transactions information through the mobile services networks. Thus, providing simple and easy instructions, comprehensive menus, and ease of use the mobile banking services influence the users' behavioral intentions. There are many studies that confirm the effect of variable "ease of use" on variable "perception of the usefulness". Results show that the degree of understanding the ease of use certainly affects the degree of understanding the usefulness. Venkatesh et al, in a broad review of others' works and studies in 2003, found that from among 82 studies that have been conducted, the relationship was significant and important in 69 cases. This definitely will influence customers on the adoption of mobile deposit.

2.4 Security

The consensus among researchers is that the security of electronic banking system is an important variable in the adoption of technology by the users. In fact, people in high risk environments need to analyze situations. Since transactions in the electronic banking environment are processed virtually and people are not able to see the process, a user perception of the security of the system may associated with mistrust, is a key factor in adoption of mobile deposit.

2.5 The bank's reputation

A bank's reputation will definitely have an impact on the customer's acceptability of the mobile deposit. In the past, there have been some financial institutions like Pyram and others which bolted with customers' money. How can customers are assured that after depositing through their cell phone the money will be in their bank account and they can access their money whenever need. According to research, 50.9% of Ghanaians attitudes toward mobile banking show that mobile phone banking can be trusted if backed by a bank (Cominos et al 2008).

2.6 Queuing in the banking hall

Looking at the traditional system where customers need to walk in to deposit money which leads to serious queuing in our banking halls compared to a system where customers can do same deposit anywhere they find themselves through mobile deposit then the customer will adopt the latter.

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ISSN: 2047-2528

Asian Journal of Business and Management Sciences Vol. 3 No. 03 [01-18]

2.7 Nonbanking Banking Hours

This phenomenon has been a major issue with regards to banks mobilizing deposits form customers after close of day business as well as Saturdays and Sundays which the banks don't work at all expect a few on Saturdays. This also applies to customers who by the nature of their business will need to deposit money within the nonbanking hours which has always been a challenge. Mobile deposit seems to be the alternative to arrest this situation.

2.8 Cost and Time

This is another factor which has discouraged low income earners and the unbanked to save because the cost and time spent to travel to the bank to deposit a few Ghana Cedis to them is not worth it. This on the other hand has affected banks to mobilize cheap funds from this sector of the economy. Distance and the cost of transport to reach a banking facility is an obstacle to banking (Cominos et al 2008).


The study was a descriptive survey to identify the role of mobile deposit in deposit mobilization. The study concentrated on nine branches of first capital plus and used stratified, convenience and purposeful techniques to arrive at the sample size of 300 from a population of 54491 which comprises of 196 staff and 54296 clients which makes up the total number of clients who have been hooked to their system to use the speed banking cards from nine branches as shown by table 1 and 2. Convenience and Purposive techniques were used because the researcher wanted to actually have for his sample branches where there is accessibility to speed banking cards. Both primary and secondary data were considered. The primary data was collected through field survey and interviews. Survey questionnaires were designed to collect primary data from staff of the company as well as clients who patronized the speed banking cards. The questionnaire was well structured and combined both open and closed ended questions. All questionnaires distributed to 300 respondents were retrieved thus making the response rate 100 percent. The secondary data was also collected from publications, magazines and the company's website. Statistical package for social science (SPSS) was used in data analysis to compute for statistical tables. Table 1 and 2 shows how the stratified, convenience and purposeful techniques were used to arrive at the above mentioned sample size for the study.


4.1 Profile of Bank Staff

4.1.1 Age of respondent

Majority of respondent sampled from the bank staff were between the ages of 30 ? 39 years representing 50% which suggest that majority of the banks staff may have many years of work experience looking at the school going age in Ghana.

4.1.3 Gender of respondent The sex distribution table 2 revealed that male employees dominate the total banking staff. This represents 52% of respondents from the bank staff. On the other hand it is a good mix since in the past the employment gap between men and women used to be very wide. Thus the company gives equal opportunity for both sexes.

4.1.3 Level of education of respondent

Majority of the respondent from the bank staff hold a university degree. This represents 76% of the total sample from the bank staff. This gave us confidence that the respondents were educated enough such that their views and opinions based on the questionnaire will not be out of place.

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