The purpose of this thesis is to develop an m-banking (mobile banking) framework for rural SMEs (small and medium enterprises) in Bangladesh. This research is significant as there is relatively little known about the use of m-banking by SMEs in Bangladesh, despite their importance as the second largest source of income in the country. The research, as well as adopting a business focus rather than a consumer focus, as most studies to date have done, also pinpoints several factors that have been largely overlooked in the literature. In seeking to identify a comprehensive range of both micro- and macro-level determinants of m-banking, the resulting framework includes customer perspectives, organisational perspectives and country-level factors that impact on the adoption of m-banking by rural SMEs. In developing the framework, the research employed a mixed methods approach, consisting of a survey of SME owners and managers, followed by interviews and a focus group study with banks and MTOs (Mobile telecommunication organisations).
The research found that poor banking facility, cost, credibility, gender, education and SME business type are the main customer perspective factors that significantly influence the intention of SME owners and managers to adopt m-banking. The findings suggest that the most important advantages of m-banking for rural SMEs comprise improved banking facility, easy settlement of trade, and an improved SME business environment due to faster transactions and better cash management. On the other hand, for banks and MTOs, m-banking can generate profits, improve customer service and management, decrease operating costs, increase brand image and create employment in rural areas. The findings with respect to organizational factors suggest that having an m-banking project within the bank’s/MTO’s objectives, their level of engagement with SMEs, the technology and human resource capabilities of the banks, the development of mobile infrastructure, and top-level management’s support are important in m-banking development. However, barriers to providing m-banking to the rural SMEs include lack of banks’ effective leadership, limited vision regarding m-banking by the stakeholders, MTOs’ reluctance to make partnerships with new banks, and m-banking providers’ competencies and security. Country-wide factors identified included concern over lack of proper policy and regulation in Bangladesh.
The framework will be of value to the government, banks and MTOs in accelerating the development of m-banking in Bangladesh. The research recommends that, in order to support rural SMEs, government intervention in m-banking projects and policy and regulations development is needed. This research is expected to support national policies, such as the Millennium Development Goal 2015 and the National IT Policy of Bangladesh. Furthermore, it has implications for other developing countries in improving their banking provision to SMEs and realizing their own development goals through mobile technologies.