Factors Influencing The Adoption Of Core Banking Systems In The Ethiopian Banking Sector: A Case Oforomia Bank Selected Branches

Abstract

This thesis examines the factors influencing the adoption of core banking system services in the Ethiopian banking sector, with a specific focus on three selected branches of Oromia Bank: Cheffe, Atlas, and Shalla. The study aims to identify the determinants that encourage or hinder the successful implementation and utilization of core banking technologies. A mixed research approach was employed, incorporating both qualitative and quantitative data collection techniques. Primary data was gathered through interviews and structured questionnaires, while secondary data was sourced from relevant literature and organizational reports. To ensure comprehensive data collection, 392 questionnaires were distributed to bank customers, out of which 363 were properly filled and returned, resulting in a high response rate of 92.6%. The sample was selected using convenience sampling, a non-probability sampling technique. The collected data were analyzed using descriptive statistics such as percentages and frequencies, and further examined through regression analysis using SPSS version 23. Findings from the regression analysis revealed that organizational factors, demographic characteristics, customer trust, security concerns, and awareness have a significant and positive impact on the adoption of core banking systems. Conversely, service interruptions were found to negatively affect adoption levels. Despite its valuable findings, the study faced limitations, including a lack of sufficient published and organizational materials, shortage of stationery, and respondents' limited familiarity with research instruments. Overall, the study provides important insights for banking institutions aiming to enhance the adoption and performance of core banking services. It recommends that banks prioritize organizational readiness, improve customer awareness, ensure system security, and minimize service disruptions to boost customer trust and satisfaction