Demographic Factors Influencing the Adoption of Mobile Phones in the Utilization of Formal Financial Services by Smallholder Farmers in Kenya

Abstract

The study aimed at assessing the demographic factors influencing adoption of mobile phones in the utilization of formal financial services by smallholder farmers in Kenya. Financial access household survey showed that 80 percent of Kenyan adults own a formal bank account. Whilst significant advances have been made in financial technology products, their penetration and usage among smallholder farmers in utilizing financial services and particularly the demographic factors influencing them remains unestablished. Research into more innovative, intermediated solutions, effective participation and inclusion of appropriate community-based groups in mobile financial services is, therefore, necessary. The target population for this study were smallholder farmers from Nakuru, Busia and Kirinyaga Counties in Kenya.  Simple random sampling and Convenience sampling techniques were used to select 496 smallholder farmers as respondents for the study. Data was collected using copies of a researcher developed questionnaire and data collection sheet. Quantitative data was analysed using multiple linear regression analysis with the aid of SPSS software. The findings revealed that demographic factors were important in predicting mobile phone utilization for formal financial services among smallholder farmers in Kenya. Therefore, the study recommends that mobile phone mobile service providers should collaborate with financial service providers to enable the farmers upgrade their phones to access more financial services platforms.