Convenience of Agency Banking and Financial Inclusion among Small and Medium Enterprises in Ilemela District, Tanzania
This study examined how the convenience of agency-banking services is associated with financial inclusion among small and medium enterprises (SMEs) in Ilemela District, Tanzania. The study was guided by Financial Intermediation Theory and used a cross-sectional mixed-methods design in which quantitative evidence was primary and qualitative evidence provided contextual explanation. Structured questionnaires generated 201 usable responses from a planned sample of 248 SME owners and managers, representing an 81.0% response rate. Quantitative data were analysed using descriptive statistics, Pearson correlation and multiple regression, while qualitative evidence was analysed thematically. The findings showed a relatively high level of perceived convenience: time saving recorded a mean of 4.13, transaction speed 3.91 and service reliability 3.72, producing a composite mean of 3.92. Convenience was positively and statistically significantly associated with financial inclusion (r = .663, p < .01). In the multivariate model, convenience recorded a positive standardized coefficient (β = .381, p < .001), while the overall agency-banking model explained 57.1% of the variation in financial inclusion (R² = .571; adjusted R² = .565; F(3,197) = 87.42, p < .001). Qualitative evidence indicated, however, that network interruptions, inadequate agent cash and electronic float, failed transactions and service unreliability could reduce the practical convenience of agency banking. The study concludes that convenience is an important correlate of financial inclusion among SMEs, but its benefits depend on reliable technological infrastructure and adequately resourced agents. It recommends strengthening network reliability, agent liquidity management, transaction-failure resolution and transparent service monitoring.
Keywords: Agency Banking, Convenience, Financial Inclusion, Small and Medium Enterprises (SMEs), Ilemela District, Tanzania
