Factors influencing customer’s intention to adopt agency banking service in Ethiopia

No Thumbnail Available



Journal Title

Journal ISSN

Volume Title


Addis Ababa University


In Ethiopia agency banking is an infant technology and has many challenges not only for service providers but also for the customers. This study tried to identify and investigates those factors which influence customers’ intention to uptake agency banking service in Ethiopia. The study employed explanatory research design. The research model includes the basic concepts of the Unified Theory of Acceptance and Use of Technology (UTAUT), as well as some constructs derived from other theoretical frameworks. Accordingly, Performance expectancy, effort expectancy, Perceived risk, public Trust on agency banking and service quality were specified as a determinant factors of customer’s intention to adopt agency banking service. Each variable is measured using 5-point Likert-scale. Using primary data collection method, questionnaires were distributed to target respondents of sampled customers of Commercial Bank of Ethiopia, United Bank S.C., Lion International Bank S.C and Cooperative Bank of Oromia applying judgmental or purposive sampling technique. Out of the total 399 questionnaires distributed, 362 useable questionnaires were obtained. Ordinal regression analysis was made using Stata version 13 whereas descriptive statistics analysis was done through Statistical Package for Social Sciences (SPSS) version 20. The findings of this study revealed that Performance expectancy, effort expectancy and Perceived risk were the significant factors affecting customer’s intention to adopt agency banking service whereas, public trust of agency banking and service quality of service providers and agents were found to be insignificant factors in this study. The study suggests a series of measures which could be taken by the banking industry. The study recommends that financial institution needs to sensitize customers about the performance, perceived risk and ease of use of agency banking service. Financial institutions should also conduct extensive promotion; marketing and cross-selling activities in order to attract new customers and increase their customer base from untapped potential of availability of highly intended users to adopt the service. Banks should also provide training and education to their employees and agents on agency banking service in order to attain better service quality, gain public trust and ultimately encourage the participation of intended users.


A thesis submitted to Addis Ababa university college of Business and economics in partial fulfillment of the Requirements for the degree of masters of business Administration


Agency banking, Branch-less banking, Effort expectancy, Performance expectancy