The impact of agent banking on the financial habits and accessibility of financial services for rural communities in mukono district
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Date
2026-04-09
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Uganda Christian University
Abstract
The main aim of this study was to find out the impact of agent banking on the financial habits and accessibility of financial services for rural communities in Mukono District. The study was specifically carried out in Nakisunga and Nagojje sub-counties. To achieve this, the researcher used a cross-sectional survey research design. The sample size of 90 respondents was comprised of local farmers, traders, and civil servants. The primary data was collected using a structured questionnaire. The data was collected through face-to-face interviews. Once the data was collected, it was analyzed using SPSS Version 20.0. The results of the research indicated that financial accessibility in rural areas has improved through agent banking. The respondents agreed that the agents are accessible since they are within walking distance. This has helped them save on the cost of transportation, which they used to spend going to Mukono Town. However, from the research, it was also established that the reliability of the agents is very low. The agents are often out of cash, and their networks are mostly unstable. This has
resulted in rural residents not fully trusting their agents to keep their finances. The research results indicated that people are using the agents for withdrawal of cash and paying of bills but are still keeping their actual wealth in their informal VSLAs. The regression results showed that although proximity is good, reliability is the strongest factor for positive financial habits. The conclusion of the study was that the issue of physical distance has been solved through agent banking, but the saving culture of the rural people has not changed completely since the system is not reliable. Based on these findings, the researcher recommended that commercial banks should support their agents by providing float loans so they always have cash. The banks should also work with telecom companies
to make the network stable, and they should create a system that allows the local VSLAs to deposit their group savings directly through the agents.
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Undergraduate