Financial Determinants of the Adoption of Bancassurance by Commercial Banks in Kenya: Case Study of Teir One Commercial Banks in Nairobi Central Business District

Abstract

The study's goal is to look at the financial factors that influence commercial banks' adoption of bancassurance in Kenya. The eight level one banks in Nairobi's Central Business District are the subject of this exploration. Coming up next are the review's specific objectives: To decide how benefit, credit hazard, item expansion, and the expense of protection contracts impact business banks' utilization of bancassurance in Kenya. Monetary Intermediation Theory, Modern Portfolio Theory, and Diffusion of Innovation Theory are totally utilized in this investigation. A connecting with outline research approach was utilized in this review. In Nairobi's Central Commercial District, there are 77 Business Development Officers and 64 Operations Officers in the bancassurance area from 8 Tier 1 business banks. The statistics strategy was utilized in this review, with each of the 141 respondents getting a survey. Both essential and optional information were utilized in this examination. Primary data was gathered using surveys, while secondary data was gathered from published papers, films, and newsletters from organizations, all of which were available in both printed and electronic formats. SPSS version 25.0 was used to conduct the data analysis. The study discovered that the biggest factor of commercial banks' adoption of bancassurance in Kenya is bank credit risk. At the point when the R esteem is 0.803, the connection between the reliant and autonomous factors is measurably huge. The R squared score of 0.6404 additionally shows that the elements being scrutinized represent 64% of the reliant variable. As indicated by the R-squared worth of 0.6448, free factors represented 64.48 percent of the general variety in bancassurance reception (subordinate variable). A portion of the significant reasons of bancassurance reception, as indicated by the examination, incorporate bank benefit, bank credit hazard, bank item variety, and protection contract cost. The report suggests that banks increase their use of bancassurance by reinvesting revenues in financial innovation. Customers will benefit from a reasonably cost revolutionary bancassuarance product as a result of this. This will not only increase the bank's revenue, but it will also increase client loyalty. Commercial banks ought to have the option to arrange ideal protection contract valuing because of the scope of protection specialist co-ops open in Kenya. Since the cost of the protection contract is given to the client, the bank should search for lower protection rates