Aveneu Park, Starling, Australia

CHAPTER objectives, and questions, research hypothesis to



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In this chapter I will presents the background of the
study, statement of research problem, research objectives, and questions,
research hypothesis to be tested, scope of the study, significance of the
study, rationale and justification of study, and organization of the research.

1.1 Background
of the study.

and Communications Technologies (ICTs) have changed the way of  conducting business transactions and meeting
the growing demands of customers for most organizations (Abor, 2004). One of
the significant forces and dynamic change that is occurring in the universal
business environment today is technology, and this  brings in new products, service market
opportunities and developing more information system that is business oriented
and supports management processes such as planning, controlling and
co-ordination (Liao and Cheung, 2002).

the banking world, developments in information technology have had an enormous
effect in development of more flexible payment methods and more user-friendly
banking services (Akinci, Aksoy, and Atilgan, 2004). The remarkable gains made
towards mobile phone access have seen a steady progress in the scope of
innovations emanating from exploitation of these fairly new technologies.


Mobile is the product service offered by NMB Bank Plc to its customers, in
cooperation with the mobile phones operators mostly Vodacom, Airtel and Tigo in
Tanzania.. Mobile banking is a services that enable customers of NMB Bank Plc
to perform banking transaction without attending at any NMB Bank Plc branch. NMB
Mobile is into two forms

Mobile banking
over Wireless Application Protocol. In this form of mobile banking enable its
users to perform banking transaction through internet services. The customer
will be required to have a Smartphone (IOS, Android or Blackberry) to access
this form of mobile banking and download an application which will enable
him/her to access his/her bank account. 


transaction involve all transaction that are provided by the bank to their
customers. NMB Bank Plc offers variety of transaction to their customers
depending on the type of accounts operated by customer.

Tanzania mobile banking have adopted and still being adopted by many banks.
Their offer considerable benefits to both banks and their depositors/customers.
Through NMB Mobile, NMB Bank Plc provide the following services :-

services including Balance Enquiry and mini statementsAirtime
purchase for Vodacom, Airtel, Tigo, Zantel and HalotelMoney
Transfer to an NMB account, NMB Pesafasta, M-PESA, TigoPesa, Airtel Money,
Halopesa Chap Chap Plus and other BanksPayment
of TV subscriptions, including DSTV, StarTimes, AzamTV and ZUKU TVPayment
of transport, including UDART, Precision Air and FastJetPayment
of water bills, including DAWASCO and other regional water authoritiesPayment
of electricity, including LUKU and other Tanesco servicesPayment
of rent, including NHCPayment
of taxes/duties including Property Tax, Income Tax, Motor Vehicle, Local
Government, Ports Authority, BRELA and Government MinistriesPayment
to various social security fundsPayment
for Health Services to various hospitals across the countryPayment 
to various high learning institutions, universities and collegesOther
services like blocking your ATM card, changing your NMB mobile PIN and change
your preferred language

the banks point of view, mobile banking (NMB mobile) reduce the cost of
handling small transactions by reducing the need of the customer to physically
visit the bank for cash withdraw or deposit transactions.

the use of
modern ways of banking therefore brought efficiency in the banking industry
mostly in terms of speed, data processing and storage, since all the
transaction are performed systematically through electronic devices. thus
brings high improvements in reducing queue in most NMB Bank branches.

1.1.1 NMB Bank Plc

National Microfinance Bank plc (NMB) is one of
the largest commercial banks in Tanzania, providing banking services to
individuals, small to medium sized corporate clients, government services,
large businesses and agriculture lending.

NMB was established under the National Microfinance
Bank Limited Incorporation Act of 1997, following the break-up of the old
National Bank of Commerce, by an Act of Parliament. Three new entities were
created at the time, namely: (a) NBC Holdings Limited (b) National Bank of
Commerce (1997) Limited and (c) National Microfinance Bank Limited.

Initially NMB could only provide payment services as
well as offer savings accounts, with limited lending capabilities, before
becoming a fully-fledged universal retail bank.

In 2005, the Government of the United Republic of
Tanzania privatized the bank when it sold part of its shareholding (49%) to a
consortium led by the Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A.
(‘Rabobank Group’).

Subsequently, there was further divestiture in 2008
when the Tanzanian Government off loaded another 21% of its shareholding to the
Tanzanian public through an Initial Public Offering (IPO). The listing of the
bank’s stock on the Dar es Salaam Stock Exchange has led to a diversified
ownership structure (https://www.nmbbank.co.tz/about-us/nmb-at-a-glance/history).

A private company ( business firm or an industry)
may operate in one sector and move to the other sector. The process of turning
a public company into the private company is known as privatization. The
opposite turn from private company to public company is known as
nationalization or municipalization depending on the level of government

1.2 Statement of the Problem

the introduction and the use of modern ways of banking
(NMB mobile) have received different people’s perceptions. one among the views
is that, it may not have really created customers satisfaction for bank
customers, and the other is that it may have. Even though the merits are many compared
to demerits of NMB mobile, customers still complaint of shortfalls on the use
of system such as poor networks in rural areas, limited knowledge on the
application of NMB mobile, frauds and its operation in just two languages.

NMB mobile is introduced in the banking system to
enhance the provisions of good financial services and efficient customer satisfaction.


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