Expanding the Market Share 1

EXPANDING THE MARKET SHARE OF ARAB BANKING CORPORATION (ABC)

THROUGH MOBILE BANKING

Student’s Name

Hasan Isa Ali AlShakhoori

Student’s ID

2231874

Supervisor’s Name

Deigo Navarra

University

Anglia Ruskin University

Course

Master of Business Administration

Date

16/7/2022
 Expanding the Market Share 2

Expanding the Market Share of Arab Banking Corporation (ABC) through Mobile Banking

Background

Mobile banking, also known as m-banking, is one of the most recent mobile

technological marvels. It entails offering customers banking services on their mobile phones.

Mobile banking describes the delivery and use of banking and financial services through mobile

telecommunications equipment. It empowers people to access their bank accounts, check their

balances, and perform financial transactions through cell phones (Priya et al., 2018).

Conventional banks use improved delivery channels such as telephones, internet banking, and

automated teller machines to sell their products (Shaikh and Karjaluoto, 2015). However, as the

latest distribution channel set up by microfinance and retail banking institutions in many

developing and developed countries, m-banking is anticipated to significantly impact the banking

market (Safeena et al., 2012). Notably, the extensive use of smartphones has expanded the

market for banking services, encouraging many other banks, microfinance institutions, software

companies, and service providers to provide the innovative service along with new collections of

products and apps aimed at increasing market share, retaining existing customers, reaching

populations without having banking accounts, and creating new job opportunities (Shaikh, 2013).

A financial institution's market share plays a critical role in its profitability, expansion, and

survival (Ali and Mashali, 2018). Thus, m-banking is crucial for a financial institution's growth

in the market.

Arab Banking Corporation (ABC) is a transnational financial company in Bahrain. It

operates in the American, European, North African, Middle Eastern, and Asian continents. The

company was founded in 1980 and is regulated by the Bahrain Stock Exchange. It is currently

focusing on incorporating digital into its product and services to enhance its business growth.
 Expanding the Market Share 3

One of the most critical components of its digital strategy, which aims to provide customers with

convenient and comprehensive online banking services, has been successfully implemented.

Nevertheless, the bank should also focus on adopting mobile banking as it can considerably

increase the company's market share. Given the rapid growth of the mobile banking market,

implementing m-banking is crucial for ABC. The innovation can help ABC to get more

customers and expand its market share.

The banking business is one of the most advanced and innovative in the world, and new

advancements are created daily to help the sector remain competitive and profitable (Elhajjar and

Ouaida, 2019). Due to intense competition, banks must launch new services and goods to

improve banking for millions of clients globally. Mobile banking is one of the modern inventions

that has given banks access to a new user base. It allows users to carry out financial activities on

mobile devices efficiently. Mobile banking has improved customers' access to financial services

worldwide, even in developing or emerging nations. Compared to online banking and traditional

branch-based banking, it offers greater benefits. Laukkanen (2017) suggests that m-banking

provides time-and-place-free banking and improved transactional efficiency. Baabullah et al.

(2019) further point out that customers often switch to financial organizations that offer mobile

banking. In Bahrain, little effort has been made to develop m-banking. Ithamar Bank is one of

the very few banks in the country that provides mobile banking (Awadhi, 2021). Consequently,

to gain a competitive edge in their respective industries, rival banks worldwide have invested

almost $115 billion to expand the adoption of mobile banking (Baabullah et al. 2019). Offering

sustainable, economical, and consumer-friendly banking can assist ABC in boosting its market

growth by attracting more customers.

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This research will help banking companies, especially Bahrain's financial institutions, to

search for innovative approaches to make mobile banking function as a powerful instrument to

promote banking services in the upcoming years. It will enable companies to adopt the

innovation as it is an intelligent way for the banking sector to attract more customers. The

primary beneficiaries of the study are ABC and customers. The research will encourage the

company to prioritize embracing new technology as it will support the financial and customer

growth of the bank. It will also have a positive societal impact as it will allow banking clients to

avoid expenses associated with traditional banking and feel more in control of their finances.

Compared to traditional banking services, mobile banking technology dramatically lowers

financial expenses. Moreover, mobile banks give customers more discretion over how they use

their money (Baabullah et al., 2019). They allow people or society to save a large portion of their

finances by preferring mobile banking over traditional banking.

Research Questions, Aims, and Objectives

Research Questions

1. Does m-banking help financial institutions to grow their market share?

2. What are the factors that influence the adoption of m-banking?

Research Aims

The study will look into how mobile banking could help ABC expand its business

through the adoption of mobile banking. Additionally, it will determine the variables that affect

the technology implementation.

Research Objectives

1. Determining the significance of m-banking in the contemporary banking industry

2. Ascertaining the relationship between m-banking and market growth

 Expanding the Market Share 5

3. Identifying factors that influence the adoption of m-banking

4. Helping ABC to grow its market share using m-banking

Literature Review

A literature review was conducted using peer-reviewed articles on google scholar.

Articles related to the significance of m-banking, the association between m-banking and a

bank's market share, and factors affecting the adoption of the technology were searched and

selected. The search was not limited to any particular area and included evidence of the

importance of m-banking worldwide. The selected literature highlights that information

technology is the primary force behind global developments. The newest and most cutting-edge

service provided by banks is m-banking. It has been a "leap" from traditional to electronic

banking.

Improvements in wireless telecommunication set the stage for mobile banking. Around 5

billion people around the globe use mobile phones, and it has been on the constant rise (Hibberd,

2007; Khana & Kaur, 2019). Banks have recognized this opportunity to reach a large number of

customers. Mobile banking is a mechanism that empowers people to perform certain financial

services using mobile technology (Pousttchi and Schurig, 2004; Tam and Oliveira, 2017). It

facilitates customers to execute banking transactions such as funds transfers, bill payments, and

money savings. On GPRS-enabled cell phones, wireless application protocols, mobile

applications, and short message services are used for mobile banking (Khan et al., 2022;

Scornava Jr and Barnes, 2004). Researchers refer to mobile banking using a variety of

terminology, including branchless banking, mobile banking, mobile finance, mobile transfers,

mobile payments, and pocket banking (Amin et al., 2006; Ivatury and Mas, 2008; Liu et al.,

2009).
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According to Kumail et al. (2021), mobile banking saves the money and time of users as

they can perform transactions without physically visiting the bank. It also facilitates the tracking

of transactions and funds management. Technological advancements in the telecom sector

increased the potential to use financial services better. Mobile banking also empower customers

to avail of microfinance facilities easily.

Mobile banking is used by many people because of improved service and ease of

executing transactions anywhere at any time (Muljani and Ellitan, 2019; Schierolz and

Laukkanen, 2007). With the increase in mobile internet and financial applications, customer

demand for mobile banking has been rising in recent years. The ease of executing a financial

transaction motivates users to adopt mobile banking, consequently increasing a bank's market

share. According to Clark (2008), mobile phones provide an additional mechanism to execute

financial transactions, giving customers cost-effective options to undertake transactions. Mobile

banking has vast market potential due to the ease of making transactions at any time and always-

on functionality (Devi, 2018; Karjaluoto, 2002). Shih and Lin (2015) found a positive effect of

service quality, perceived usefulness, and perceived ease of use on the intention and attitude of

users to use mobile banking, which will increase the market share. Mayo et al. (2014)

investigated the effect of mobile financial services on banks in the context of Kenya. The

findings imply that mobile banking has been used to grow market share, diversify customer

bases, and attain a competitive edge to raise revenue and strengthen financial standing. Mabwai

(2016) investigated how a financial institution's share in the m-banking market affected its

financial health. The findings show that the market share positively impacts the company's

performance. This implies that if a bank offers mobile banking, it will have more customers who

use the service and make considerable profits by gaining a sizable market share.
 Expanding the Market Share 7

Santini et al. (2017) investigated the effect of mobile banking on customer satisfaction

and the moderating effect of cultural uncertainty avoidance and perceived justice. The research

also investigated how customer satisfaction predicts loyalty, trust, and positive word of mouth.

The results indicate a positive relationship between mobile banking applications and customer

satisfaction. Additionally, research finds a significant moderating effect of perceived justice.

Safeena et al. (2012) examined the adoption of mobile banking from the consumer's point of

view. They gathered data from prior studies on the acceptance of mobile banking using a survey

instrument in the form of a questionnaire. The findings indicate that consumers are eager to

adopt technology that can be more convenient and cheaper than traditional banking.

Mullan et al. (2017) investigated the stakeholders' perception of mobile banking by using

the Delphi technique to study the drivers and impediments of mobile banking. The stakeholders

include technology providers and researchers in the relevant field. The significant factors in the

adoption of mobile banking are mobile penetration globally, customer demand, and low

perceived risk concerns. In contrast, customer demand and low-return investment are essential

impediments.

Nazaritehrani and Mashali (2020) examined how market share was affected by cutting-

edge channels, such as telephones, automated teller machines, online banking, and m-banking.

Questionnaires were used to collect the data, and linear regression was used to analyze the data.

A positive effect of internet banking, point of sales, and telephone was found, whereas mobile

banking and ATM did not affect market share. Research conducted by Hani and Zouhour (2018)

also found that the profitability of Lebanese financial institutions were improved as a result of

investments in technological innovation such as online banking and ATMs. However, the

performance of Lebanese banks was not significantly impacted by investments in mobile

 Expanding the Market Share 8

banking.The findings of the two studies contradicts other studies that consider m-banking a game

changing innovation. However, keeping in view other studies, it can be concluded that mobile

banking can have a significant positive effect on the market share of banks.

Research Design and Methodology

Approach to Theory Development

` The study will employ a deductive research design approach to seek answers to the

research questions. In a deductive approach, a hypothesis is formulated from an established

model, and then a study method is developed to evaluate the thesis. Wilson (2014) suggests that

the deductive research method is the movement from the specific to the general. If a theory or

case study seems to imply a causality relationship or correlation, it may be true in many

instances. A deductive design may be used to determine whether this association or link holds

true under more general conditions. Hypotheses inferred from the theory's assumptions can be

used to explain the deductive process. In other words, the deductive method focuses on drawing

inferences from premises or assertions.

Formulate
Existing Theory Collect Data Analyze Data
Hypothesis

Reject/or don’t
reject
hypothesis

Deductive Approach Fig. 1

 Expanding the Market Share 9

The diffusion of innovation theory by E.M. Rogers (1995) will be applied to the study. It

explains how a fresh concept or product gains traction and expands over time within a specific

community or social system. As a result of this dispersion, individuals gradually incorporate a

novel concept or item into their social structure. The theory states that trialability, observability,

compatibility, relative advantage, and complexity affect the diffusion rate. Trialability is the

extent to which an innovation can be partially or gradually tried (Roger, 1995). The degree to

which an innovation's benefits are made accessible to people is measured by observability.

Compatibility ascertains how much a new innovation is consistent with the adopters' pre-existing

values, beliefs, and requirements. The extent to which an innovation is considered superior to its

predecessor is known as relative advantage. Complexity is centered on how challenging it is to

use, learn, and comprehend the invention.

A number of factors can affect how quickly an organization adopts new technologies.

The two stages of organizational adoption are initiation and completion. In the first stage, the

organization learns about the innovation, forms an opinion about it, and evaluates it throughout.

Subsequently, in the second stage, it opts to buy and use the innovation during the completion

stage. When an innovation is adopted by and integrated into the organization, the innovation

process is successful. The theory will assist in formulating the hypothesis for the research and

conducting a deductive process.

Research Philosophy

According to the positivist worldview, factual data produced from observations,

especially measurement, is the only information that can be trusted. The researcher's

responsibility in positivist investigations is restricted to the gathering and impartial data analysis.
 Expanding the Market Share 10

In other words, the researcher approaches the study as a neutral analyst who dissociates

themselves from personal desires. Research outcomes in these kinds of investigations are

frequently observable and measurable. Quantifiable observations that result in statistical analysis

are necessary for positivism. For many years, positivism has dominated business and

management research. As a theory, it is said to be in line with the empiricist theory that believes

knowledge derives from human experience. It sees the world as consisting of distinct,

quantifiable components and events that operate in a predictable, orderly, and atomistic way.

Additionally, there are no accommodations for human interests within positivist investigations,

and the researcher is separate from the study.

According to Crowther and Lancaster (2008), positivist studies typically use a positivist

paradigm. Additionally, positivism holds that researchers should focus on the facts. The study

aims to investigate the connections between mobile banking and market share. The research will

employ quantitative analysis to explain these linkages, test the theory, characterize the pattern,

and ascertain the factors influencing the use based on the scientific or positivistic paradigm.

Deductive reasoning is used in the research technique to move from generalizations (theory) to

predictions (hypotheses), explanations, and understanding of the drivers affecting the adoption of

mobile banking.

Research Design

Research design is the process of conducting a study to analyze and answer a set of

formulated research questions under the direction of a plan. The study will use action research

design that focuses on the cooperation between the organization and researchers to resolve the

formers’ issues. of action research. The action research framework that will be employed for the

study is given below:

 Expanding the Market Share 11

Creating
Theorizing guiding
principles

Problem
Intervention
identification

Action Research Model Fig. 2

Problem identification, theorization (comprehending, explaining, and refining the theory

on the practical problem), creating guiding concepts, and intervention are important components

of the model (Elg et al. 2020). Action studies spiral through the subsequent cycles of self-

reflection: making plans to bring about change; putting the change into action while keeping an

eye on the implementation process and its effects; reflecting on changing procedures and re-

planning; acting and watching, and reflecting. Thus, it mainly deals with the processes of

planning, acting, observing, and reflecting.

Data Collection and Analysis

The research will be quantitative. It will gather secondary data from 30 online primary

research journals dated between 2017-2022 on the use of mobile banking and its influence on the

market share of financial institutions. Besides, the study will focus on observing factors that can

influence the adoption of m-banking. It will include papers that have collected data from surveys

on the adoption of mobile banking and its effects on the market share of various banks to

investigate the link between m-banking's introduction and market growth. Specific keywords
 Expanding the Market Share 12

will be used for searching scientific journals, such as the importance of mobile banking, the

advantages of implementing mobile banking for financial institutions, the association between

mobile banking and the market growth of a banking organization, and the impact of mobile

banking on market share. The research will employ probability sampling to choose the sample.

The study will employ purposive sampling to collect relevant data. The sampling

technique focuses on the researcher's judgment when determining and choosing units that can

provide the most appropriate information to meet the research's goals. As the study is on

innovative and relatively new technology, it may be possible that articles on m-banking will be

challenging to find. Structural equation modeling will be employed to perform the project data

analysis. This study aims to investigate how the adoption of m-banking will positively impact the

market share of financial institutions. Structural equation modeling (SEM) is thought to be the

most appropriate research analysis method as it can be used to assess a theoretical model that

includes direct and indirect interactions between independent and dependent variables. The

expected limitation of the research is that the selected articles will be from different countries

and show varying results regarding adopting m-banking. Thus, it would not be easy to generalize

the results of the study.

Saunder et al. (2016) proposed a that outlines the various choices a researcher has to

make when creating a research methodology. The advantages of the research onion are that it

establishes a sequence of stages under which the various data-collecting techniques can be

understood and provides an example of the processes that can be used to explain a

methodological investigation.
 Expanding the Market Share 13

Research Onion Fig. 3

To better understand the research methodology, the research onion of the study is given

below:
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Positivism

Deductive
Action
Research

Mono Method
fhpppp
Cross Sectional

Secondary Data

Research Onion Fig. 3

Project Plan

Research Design and Beginning Date Last Date

Planning

1. Finalize study 01/12/2022 01/12/2022

questions

2. Create a research plan 01/12/2022 01/12/2022

Literature Review Beginning Date Last Date

1. Find, understand, and 02/12/2022 05/12/2022

summarize pertinent
literature

2. Prepare draft of 05/12/2022 07/12/2022

literature review

Data Collection Beginning Date Last Date

1. Draft the literature 7/12/2012 9/12/2022

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review

2. Create a data 12/12/2022 12/12/2022

collection tool

3. Conduct data 13/12/2022 15/12/2022

collection

4. Write procedure for 16/12/2022 16/12/2022

data collection

Data Analysis Beginning Date Last Date

1. Organize data for 19/12/2022 20/12/2022

analysis

2. Conduct data analysis 21/12/2022 23/12/2022

3. Draw conclusions 26/12/2022 27/12/2022

and/or suggestions

Writing Up Beginning Date Last Date

1. Final draft of research 28/12/2022 30/12/2022

2. Review draft 02/01/2023 02/01/2023

3. Final editing 03/01/2023 05/01/2023

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The research activities have been divided into different small tasks and milestones to

keep track of the activities and complete them efficiently. The time set for each task is

appropriate as it enables the researcher to complete the phases of the research without any haste.

Moreover, sufficient time has been allotted to cover any variations or slippage in the

performance of the divided tasks.

Risk Management

Raid Summary

A researcher evaluates the project's risks, issues, dependencies, and assumptions using

the RAID summary. In collaboration with the team and stakeholders, the researcher completes

the assessment during the project planning phase. Subsequently, they create a RAID log that

contains their analysis. RAID analysis is crucial since it can assist the investigator in foreseeing

potential issues and preparing the project team to handle roadblocks. It can help a project stay on

schedule and avoid delays.

Risks Assumptions Issues Dependencies

Total Risks # Total Assumptions # Total Issues # Total Dependencies #

2 2 1 1

Risk Level Criticality Priority Priority

1. low 1. medium 1. high 1. high

2. medium 2. medium

Raid Log
Expanding the Market Share 17
 Expanding the Market Share 18

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