Effectiveness of mobile money services on performance of small and medium enterprises in Uganda. A case of Kampala central business district

Abstract

The study on the effectiveness of mobile money services on SME performance in Uganda was conducted in Kampala Business District. The study focused on examining the financial and operational factors influencing the usability of mobile money services by SME owners and determining the relationship between the financial and operational factors influencing the usability of mobile money services and SME performance. A sample of 147 respondents participated in the study. Data collection methods included questionnaire and document review. A survey research design was used. Both primary and secondary data were analysed using Statistical Packages for Social Sciences (SPSS) software version 26.0 and the results were presented in the form of tables using frequencies and percentages. The study relied on primary data which was collected using questionnaires. Quantitative data was presented in frequency tables and figures while quantitative data was presented in prose form. Multiple-regression was used to test the relationship between the independent variables and dependent variable. The findings were certain that all the independent variables were found to be positive but only five factors (ease of use, security, ease of accessibility, convenience of technology and time saving) were statistically significant (p>0.05, α=1%) and one factor (cost saving) was statistically insignificant (p<0.05, α=1%) on the performance of Small and Medium Enterprises (SMEs) in Uganda. The study recommends that service providers as well as the government through its agency (UCC) need to consider reducing or standardizing the costs associated with mobile money services as many businesses suffer greatly from the costs incurred as they are very high. SMEs should also use mobile banking (m-banking) to carry out financial transactions linked to their account and have access to services such as balance checks, account transactions, payments, loan applications and other banking transactions via a mobile device.