Essay: The implications of mobile money transfers on small and medium business enterprises in Zimbabwe: A case study of Chitungwiza

Abstract
This study sought to investigate the implications of mobile money transfers in Zimbabwe. The study was carried out in Chitungwiza. Forty-five questionnaires were administered to Small and medium enterprises (SME) and thirty-one were successfully completed. A focus group discussion was carried out with SMEs from various types of businesses some of which included engineering, retail, marketing, carpentry, and farming.
The research found that a number of SMEs actually benefited from the usage of mobile money transfer services which are currently in operation in the country. Some of the benefits derived from using mobile money transfer services were increased efficiency, increased profits and conducting transactions is made a lot easier.
Mobile money transfer services also come with their own negative impacts which make SMEs be in a position not to be willing to make use of these services. Some of these negative implications come in the form of charges which are charged by network providers to those who will be performing mobile money transactions. These charges that are imposed on SMEs when they carry out transactions tend to shun enterprises from making use of the services provided. Also due to network problems SMEs have resorted not to use these services as the network may not be available so that their various transactions may be conducted.
The research recommended that the government should regulate the charges that are imposed by network providers so that SMEs may be supported by these services.
Keywords: Mobile money Transfers, Mobile products, Small and medium enterprises and mobile money transfers.
Abbreviations
CABS-Central Africa Bank
CBZ- Commercial Bank in Zimbabwe
FBC- First Banking Corporation
GDP-Gross Domestic Product
IASCF-International Accounting Standard Foundation
MMS-Mobile Money Services
MMT- Mobile Money Transfers
MNO – Mobile Network Operators
MSME- Micro and Small and Medium Enterprises
SEDCO- Small Enterprises Development Corporation
SIM- Subscriber Identity Module
SMEs-Small and Medium Enterprises
UNCTAD- United Nations Conference on Trade and Development
List of Figures
Figure 1: Concept of mobile money transfer process ………………………………………………………7
Figure 2: How individuals come to adopt new technology’…………………………………………..10
Figure 3: the distribution of respondents in terms of sex””””””’.’26
Figure 4: Type of businesses of respondents”””””””””…27
Figure 5: The number of employees in SMEs that responded to the Questionnaire””27
Figure 6: Number of respondents who make use of mobile money transfers ”””.28
Figure 7 usage of mobile money transfer services””””””””…30
Figure 8: Positive implications of MMT on SMEs””””””””..31
List of Tables
Table 1: Major Differences between the Inductive and Deductive Approaches””’17
Table 2: Test statistics of chi-square””’…..””””..””..”..28
Table 3: The quantum of transactions carried out by SME respondents””””29
Table 4: Perception of respondents to the quality of services rendered by MNO””..30
Table 5:Positive benefits attributed to MMT usage”””””””’ 31
Table 6: Negative implication on MMT usage””””””””’…32
Table of contents
Chapter 1: Introduction
1.1 Background 1
1.2 Problem Statement 3
1.4 Research Questions 3
1.5 Justification of the study 3
1.7 Summary of the chapter 4
Chapter 2: Literature Review
2.0 Introduction 5
2.1 Definition of key terms 5
2.2 Theoretical Literature 6
2.3 Theoratical background 9
2.4 Empirical literature 13
2.5 Summary of the chapter 14
Chapter 3: Research Methodology
3.1 Introduction 15
3.2 Research Design 15
3.3 Research Philosophy 16
3.4 Research Strategy 18
3.5 Population and Sampling Techniques 19
3.6 Sampling Techniques 20
3.7 Data Collection Methods 22
3.8 Research Procedure 24
3.9 Research Limitations 25
3.10 Chapter Summary 25
Chapter 4: Results and Discussion
4.1 Introduction 26
4.2 Data presentation process 26
4.3 Presentation of findings 26
4.4 Discussions”””””””””””””””..35
4.5 Conclusions………………………………………………………………………………………………………….37
Chapter 5: Conclusions and recommendations
5.1 Introduction 38
5.2 Summary of the research 38
5.3 Conclusion 38
5.4 Recommendations 39
5.5 Summary 40
Reference………………………………………………………………………………………………………………..41
Appendix 1”””””””””””””””’..49
Appendix 2”””””””””””””””..’54
Chapter One: Introduction
Orozco (2003) suggests that the growing decrease in the prices of mobile handsets and the introduction of prepaid cards has led to the spread of usage of mobile phones in emerging economies. This spread of mobile phone usage has opened doors to opportunities that emerged a few years back, which is the use of mobile phones for financial services. There are more than two billion mobile phone users in the emerging economies (Hughes and Lonie,2007).This research seeks to unveil the implications of mobile money transfer services on Small and Medium Enterprises(SMEs) in Zimbabwe through a case study of Chitungwiza. The study takes a look at how mobile network operators (MNO) have developed mobile money services (MMS) and how this has improved small and medium enterprises business operations.
1.1 Background
Literature has reviewed that the first mobile money transfer (MMT) was established in Zimbabwe in 2011(The Independent newspaper November 2011).There are at least three mobile network providers in Zimbabwe: Econet Wireless, NetOne and Telecel according to the Standard newspaper of May 12, 2013. The World Bank (2009), proposes that the primary function of mobile money transfer services is to reduce the costs of making payments from one individual to another, especially across long distances.
United Nations Conference on trade and development (UNCTAD) in 2012 defined mobile money as ‘money stored using the subscriber identity module (SIM) in a mobile phone as an identifier, as opposed to an account number in a conventional banking’. MMTs make use of a SIM card which is a portable memory chip which is commonly used in mobile phones handsets.
Tiwari, Buse and Herstatt (2007) define mobile banking as the provision and availing of banking services with the help of mobile telecommunication devices. In Zimbabwe the three network service providers: Econet Wireless, NetOne and Telecel (the Standard newspaper of May 12, 2013 )have worked with various banks to provide mobile and money products, such as: Ecocash offered by Econet Wireless, Textacash which is working with Central Africa Bank (CABS),Mobile banking being offered by Commercial Bank in Zimbabwe (CBZ) , Onewallet which is provided NetOne, Telecash/skwama that is made available by Telecel, Mobile moola which is provided by First Banking Corporation (FBC) and lastly Cybercash of Interfin Bank. According to the Standard newspaper of May 12, 2013 Ecocash is the country’s leading mobile transfer service which is provided by Econet Wireless. The service accommodates both the banked and unbanked members of society. With Ecocash one can send money, receive money, buy airtime and conduct merchant payments. Small and Medium Enterprises (SMEs) can make use of Ecocash to receive payments for the different services and products they would have provided.
Mobile money services can be divided into three categories:
i. Money transfers-where money is transferred from one user to another.
ii. Mobile payments- where money is exchanged between two users followed by exchange of goods and services
iii. Mobile financial services-where mobile money can be linked to a bank to provide the user with a range of transactions such as savings and credits, which would have been obtained from the bank ordinarily.
‘The Small and Medium Enterprise sector has been faced with the problem of definition clarity’ (Simpson & Ndlela, 2010:26-27). The challenge is to determine the standard in terms of employees and annual sales value that qualifies an organization to be classified as an SME. According to Abor & Adjasi (2007) small and medium enterprises can be defined using different bases such as number of employees, annual turnover, ownership of enterprise and the value of fixed assets. SME department of the World Bank (2009) views small enterprise businesses as those formal entities with at most fifty employees and total assets and annual sales of up to three million United States dollars. On the other hand, the International Accounting Standard Foundation (IASCF) (2007) defines SMEs as an entity that does not have public accountability and produces general purpose financial statements for external users.
According to the Financial Gazette newspaper of 12 December 2012, The Ministry of SMEs (2000) defines a small enterprise as a business that employs not more than fifty people while operating as a registered entity and a medium enterprise as one employing within the range of seventy-five to one hundred people. Small Enterprises Development Corporation (SEDCO) (2010) does not differentiate small and medium businesses but instead defines small and medium enterprise as a firm that has not more than one hundred employees with a maximum annual sales of up to US $830 000. The micro and small and medium enterprises (MSME) policy and strategy framework has defined small and medium enterprises as those which are registered in terms of their legal status and employing between six to one hundred people (Zimbabwean 2008,pp:20).
1.2 Problem Statement
Mobile service providers have brought new innovations in the financial services sector. While many people have quickly embraced the innovation of mobile money transfer services, some people have argued that the service is too expensive and inaccessible by the poor and small businesses. On the other hand there is another school of thought that has viewed mobile money transfer services as convenient, cheap and all inclusive. Has the introduction of mobile money transfer services benefited those communities that were previously financially excluded? Should rural folks, poor communities and SMEs rejoice due to the introduction of mobile money transfer services?
1.3 Research objectives
‘ To evaluate the effects of mobile money transfers services on SMEs.
‘ To assess the degree of usage of mobile money transfer services by SMEs in their financial transactions
‘ To analyse the impact of mobile money transfers on financial inclusions of the SMEs
1.4 Research Questions
‘ What are the negative effects of mobile money transfers to SMEs’? What are the benefits of mobile money transfers to SMEs
‘ How has the harnessing of mobile money transfer services in Zimbabwe improved the quantum of financial transactions by SMEs?
1.5 Justification of the study
SMEs are the heart of the Zimbabwean economy as they contribute significantly to the Gross Domestic Product (GDP) of the country. The study will therefore be crucial for policy makers and various stakeholders when they come up with policies that affect SMEs. The study will also be of help to network providers as it unveils the negative and the positive implications of MMTs to SMEs, thus calling for an improvement in the efficiency and effectiveness of mobile money transfer services. Mobile service providers will be guided on the issues that need further improvement.
1.6 Research limitations
Due to the amount of time available it might be difficult to do many focus group discussions. In addition, it may not be possible to get information from all the expected respondents. Some data may not be readily accessible as it will be considered private and confidential by the organizations concerned. However, the researcher will counter these limitations by approaching the Ministry of Small and Medium Enterprises and the Small and Medium Enterprises Association of Zimbabwe, in order to get assistance in distributing the questionnaires to their respective members.
1.6.1 Delimitations of the study
The research is limited to the Small and Medium Enterprises in Zimbabwe which operate in Chitungwiza. The study focuses on mobile transfers and SMEs.
1.7 Summary of the chapter
Chapter 1 will cover the background information to the study. Chapter 2 will present and critical review the literature on mobile money transfer services and SMEs.
Chapter 2: Literature Review
2.0 Introduction
This chapter provides a synopsis and a critical assessment of a body of literature that
relates to the research topic and problems. The review has been divided into
empirical and theoretical evidence so as to clearly highlight the concepts and models
related to the implications of mobile money transfers on small and medium enterprises.
2.1 Definition of key terms
Small and medium enterprises
In the literature concerning the definition of SMEs all over the globe, there has not been one measure on which the definition of SMEs is based upon. Kapoor (1997), identifies the number of employees, turnover levels, the amount of total assets, the capital base that is the amount of capital that was initially invested when the business was started, the legal structure and the degree of formalization as some of the measures that can be used in defining SMEs. SEDCO (2010) and Fong (1971) define small and medium enterprises as a firm that has not more than 100 employees and a maximum of annual sales of US $830 000.Additionally, the government of Zimbabwe (2000) defined a small business as one that employs not more than 50 employees and acting as a registered entity whilst on the other hand, a medium business enterprise is a firm employing between 75-100 employees.
Mobile Money Transfers (MMT)
Dorovan (2012) points out that mobile money transfers involves transfer of cash from one user to another without the exchange of goods involved. Additionally, this is done through the use of mobile technology. MMT is regarded as an aspect of a broader concept emerging in the electronic payment and banking industry referred to as mobile money.
Mobile money
Jenkins (2008) defines mobile money as money that can be accessed and used via a mobile phone. Mobile money is any transaction that requires converting money into electronic value using a device and vice versa. Dorovan (2012) defines mobile money as the provision of financial services to people using a mobile device. These services include: mobile payments, mobile banking and mobile finances. In other words, a mobile phone can facilitate payments, banking, credit and insurance arrangements.
Mobile payments
Jenkins (2008) advocates that mobile payments can take three forms namely: person-to-person, business-to-person and business-to-business. Person to person is when an individual transfers money to other individual(s). Business to person is when an individual will be paying a business for the services rendered or goods supplied. Business to business is when transactions take place between two different businesses.
Mobile banking
Tiwan (2007) defines mobile banking as the provision of availing of banking services with the help of mobile telecommunication devices. Mobile banking refers to the ability of an individual to make business transactions and enquiries using a mobile phone. Thus an individual can basically perform all the activities that would have been normally performed at a bank through the use of his/her mobile phone. Gencer (2011) views mobile finance as the ability to access services regarding credit, insurance and savings via a mobile phone. Chimbangwa (2012), suggests that the financial transacting public has been faced with a plethora of money transfer options as the country moves towards cashless economy. Mobile money products available on the market include: ZB bank’s e-wallet, e-mali, Econet Wireless ecocash product as well as CAB’s textacash, telecash and one-wallet.
2.2 Theoretical Literature
Conceptual framework
Business practices in Zimbabwe have undergone several changes, one of the major change was as a result of developments in the information communication technology. Mobile phones have brought technology that has made an impact on various business enterprises. This is evident in various areas of the business which include marketing, advertisement, new product launching and the payment of bills. Anurag, Tyagi and Roddi (2009) consider this system as a relatively affordable, personal, easy accessible and usable everywhere at any time. There is an appeal and utility of mobile banking and mobile payment services across the country as there are probably more people with mobile handsets than with bank account (Porteous, 2006).Zimbabwe statistics observed that 85 % of the population in Zimbabwe have access to mobile phones. According to Postal and Telecommunications performance report (third quarter 2013) it has highlighted that mobile penetration rate has increased by 5.1% points from 98.4% to 103.5% reflecting an increase in mobile subscriptions from 12 796 118 recorded in the previous quarter to 13 518 887 as at end of the 3rd quarter 2013.Mobile phone technology eliminate time and distance as they were once regarded as barriers to regional business. In Zimbabwe mobile money transfers scheme have taken toll in the past decade. Services on the market include: FBC Bank’s mobile moola and CABS textacash both powered by Telecel Zimbabwe and the netone’s one wallet. The Standard Newspaper (2013), suggests that amongst all the mobile money services on the market, ecocash a service provided by Econet Wireless which was launched end of 2011, has been the fastest and widely adopted mobile money transfer scheme. The service has grown more that 1.7 million subscribers, by Nov 2012 (as according to the Zimbabwe Independent, 2012).Ecocash registered about 2.3 million people 18 months after its launch out numbering all of the Zimbabwe’s traditional bank in total (Levin, 2013).Mobile money services are focusing on providing convenient, safe and affordable financial services to both the banked and the unbanked individuals in Zimbabwe. Oluwatayo (2012) views that mobile technology has revealed opportunities and allowed nearly 3 billion people without bank accounts to access financial services.
Figure 1: Concept of mobile money transfer process
Adapted from Mohit (2009)
The concept of Mobile financial transactions
SMEs have embraced the technology of using mobile phones in their operation, as this is viewed as relatively affordable, personal and can be used anywhere at any time (Anurag et al, 2009).There is an appeal and utility of mobile banking and mobile payment services across the country as there are probably more people with mobile handsets than with bank accounts (Porteo, 2006). According to Guagraw (2007), one of the objectives of mobile financial transactions is to improve the efficiency of SMEs through the use of mobile technology by making business operations more efficient, making transactions faster, more secure and cheaper. Mobile financial transactions comprises account transactions, balance checks and payments. Accordingly, Mbiti and Weil (2011) observed that mobile phones technology has made it easier for SMEs to perform their financial transactions for the reason that mobile phone financial transactions save time and provides a safer means of handling money transfers. Furthermore, Mbiri (2010) adds that mobile technology can be used to reach more customers, facilitates the exchange of information and the process of decision making. He supported the idea that mobile phone transactions provide SMEs with a platform on which they can manage their operating costs and thus increasing their ability to extend business networking improving the performance of the SMEs. According to Porteo (2006) mobile data technologies which embrace mobile phone technology eliminate time and distance which are often regarded as barriers to regional businesses. Jensens (2007) lay emphasis on the fact that mobile phone transactions help SMEs in calling for a reduce information asymmetries and market inefficiency hence enabling them to attain improved performance.
Mobile financial transactions and SMEs financial performance
According to Bangens and Soderberg (2010), mobile financial transactions tend to lead to increased efficiency in SMEs. This is as a result that mobile financial transactions save time when processing business transactions. Higgins, Kendall & Lyon (2012) observed that most SMEs tend to prefer mobile phone based financial transactions as they are easier than bank based financial transactions. This is due to the reason that mobile phone based business transactions do away with the burden of incurring travelling expenses when individuals want to collect and make payments. Bangens and Soderberg (2010) propounds that with the help of mobile money transfers SMEs can significantly reduce their operating costs and can improve on their performance. Jensens (2007) lays emphasis on the fact that mobile phone financial transactions assist SMEs in reducing information asymmetries and market inefficiencies hence enabling them to attain improved performance.
2.3 Theoratical background
The study focuses on factors that influence mobile money transfer usage by the small and medium business enterprises and applies the theory of technology acceptance model (TAM).
According to Davis( 1989),TAM is defined as the theoratical model that explains how users come to accept and use technology.Ndubisi & Richardson(2002), acknowledges that TAM has been widely adopted to predict user acceptance and usage of the new technology based on the perceived usefulness and ease of use.The model suggest that when users are faced with new technology there are a number of factors that will influnce their decision of whether or not to adopt the new technology.These factors are:
1. perceived as usefulness
This refers to the extent to which an individual believes that adopting a particular system will enhance his/her current performance.
2. Perceived as easy to use
This is defined as the extent to which an individual believes a particular system would be free from effort (Davis, 1989).
These two factors are regarded as the main primary determinants of one adopting and using new technology. Lu,Yu,Liu and Yao(2003) advocates that there are also other factors that may influence one’s decision of adopting new technology such as convenience, satisfaction, security, concerns and costs. Therefore, TAM is the most appropriate as it encompasses other factors such as perceived as easy to use, accessibility of mobile payment services, convenient, security, support from the mobile service provider, low cost of the mobile payment services and actual usage of mobile payments. Figure 1 outlines the research framework and integrates the theoretical perspectives discussed.
Figure 2: Conceptualization
Perceived easy accessibility
Perceived low cost
Perceived ease of use
Perceived satisfaction
Perceived usefulness
Perceived convenience
Behavioural intension to use
Success and growth
Actual usage
Perceived support
Perceived security
Adapted from Mbongo (2010)
Easy accessibility
Pagani (2004), states that accessibility (ability to reach the required services) is one of the main advantages of mobile payment services. SMEs are among the greatest beneficiaries of using Ecocash mobile payment. As at 31st of February 2011, there were 500 agents spread throughout the country offering the mobile payments service (Econet Wireless annual report, 2011/2012).By having many agents spread out around the country, the SMEs have easy accessibility of the services and thus they go to the bank less often and spend more time running their businesses. Equally, many people without bank accounts in Zimbabwe both in the city and rural areas can now receive or send money anywhere within the boundaries of Zimbabwe (Omwansa, 2009). Majority of the SMEs business operators are familiar with the use of the mobile payment services as they are easy to use and require no formal training before use (Pangani (2004). The following hypothesis was formulated to test this variable.
H1: Easy accessibility have a positive influence on the success and growth of small and medium business enterprises in Zimbabwe.
Transaction Costs
The transaction costs charge on sending money through mobile payment technology are lower compared to those charged by banks and money transfer operators (Omwansa, 2009). Mallat (2007), propounded that the charges added to a payment transaction impacts directly on a consumer if the cost is passed on to the consumers. The hypothesis formulated from this variable is as follows:
H2: Success and growth of small and medium business enterprises depend greatly on low costs.
Convenience and Security
states that a lost or stolen mobile phone does not mean catastrophe as no one can access one’s mobile money account without a correct personal identification number (PIN).Additionally, he proposes that in a country where majority of individuals are financially excluded, mobile transfer services provides both convenience and safety. Thus, individuals can move around with virtual money and can have access to withdrawing at any given time. Shon & Swatman (1998) supports the view that there is confidentiality of information and security as this is guaranteed by the use of the PIN, which is a secret code for the mobile money transaction services. Nam, Yi, Lee and Lim, (2005), have found out that the primary concern of users of mobile money transfers is security and safety. The mobile payment system is regarded safe in that there are no delays incurred in conducting the process and also no private information is disclosed by the agent during the process of carrying out transactions (Shon & Swatman, 1998)
Thus formulating the following hypothesis:
H3: Convenience positively influences the success and growth of SMEs in Zimbabwe.
H4: Security positively influences the success and growth of SMEs in Zimbabwe
Perceived Support from the Mobile Network Providers
Payment systems reveal network externalities as the value of a payment system to a single user increases when more users begin to use it (Van Hove, 2001; Mallat, 2007). Consumer decision to adopt a payment system is therefore significantly affected by the number of consumers and traders using it. Failure to build an acute mass contributes to discontinuance of several prior payment systems, including several smart card systems (Szmigin & Bourne, 1999). Thus formulating the following hypothesis:
H5: Support from the mobile payment services provider positively influences the success and
growth of SMEs.
Satisfaction
Pangani (2004) from the studies he conducted through his personal encounter with a vast number of individuals he found out that mobile money transfer technology is user friendly. Also with reference to his prior studies they revealed that speed, convenience, usability and usefulness of the service itself determines how one reaches a decision of adopting technology. Econet Wireless report for the end of the month of February 2011 shows that there were 5 510 000 registered Econet customers showing an increase in the number of customers as compared to 3 551 000 customers posted in 2010 .On average there are about 5367 new registrations per day representing a growth of 55% from the previous year’s Econet Wireless financial report (2010) .This is an indication of great satisfaction and a continued usage of the service that attract new customers to adopt the new technology. The hypothesis generated from this variable is:
H6: Satisfaction brought by the adoption of mobile payments services positively influence success and develop of SMEs in Zimbabwe
Actual Usage of the Mobile Payment and business performance
The continued increase in the usage of mobile phones has led to the number of people using mobile phone outweighing the banked population Porteous (2006). He further propounds that the performance of an organisation largely depends on what is referred to as an enabling environment, which is a set of conditions which endorse sustainable circumstances necessary for market development. Mobile money payment provider agents are spread out throughout the country, thus MNO has provisions for an enabling environment, and SMEs can make cash deposits and cash out transactions. Since agents are spread around the country this makes the service easily accessible to SMEs giving them the necessary support for their business functions. The formulated hypothesis for this variable is:
H7: A plan to use the technology have an impact on the actual usage figures of mobile payments services.
H8: The actual usage recorded of mobile money payments impacts positively on the ultimate growth and success of SMEs in Zimbabwe.
2.4 Empirical literature
Huang (2008) carried out a study to determine the impact of mobile phones on SMEs performance in Auckland, New Zealand. In collecting primary data, he made use of a questionnaire. In addition, the results for his study highlighted that the use of mobile technology enabled SMEs to increase their annual turnover due to additional business networking opportunities. Additionally, Bangens and Soderberg (2008) assessed the role of mobile banking and its potential to provide basic banking services to the vast majority of people in sub-Saharan Africa. He made use of both secondary and primary data in his research. According to his findings they revealed that mobile banking has facilitated financial transactions and remittance of funds. Moreover, the results he got from his research indicated that mobile banking has enhanced the operations and competitiveness of SMEs. Chogi (2006) also carried out a study to investigate the impact of mobile phone technologies on SMEs in Nairobi. A questionnaire being his tool for data collection. From his findings, it was highlighted that mobile phones had a positive impact on the revenues posted by SMEs. Also in addition, the results revealed that most SMEs perceived that mobile phones enable them to reduce operating costs. Likewise, Donner and Escobari (2010) assessed the usage of mobile phones by SMEs in developing countries. The two individuals med us of questionnaires to collect data from the fourteen research studies that had examined mobile use by SMEs. Their finding reviewed that mobile phones have helped SMEs to become more productive and to improve their sales thereby improving their financial performance. Wambari (2009) carried out a case study in Kenya investigating the impact of mobile baking in developing countries .In his case study he made use of a sample of 20 SMEs which to them he presented a semi-structured questionnaire that he used as his tool of data collection. From the results he obtained, they clearly indicated that the adoption of mobile banking has enabled SMEs to increase their sales thereby leading to improved financial performance. Similarly, Huggins at el (2012) conducted a study to determine the usage patterns of Kenyan SMEs.
2.5 Summary of the chapter
Chapter 2 has presented and critical reviewed the Literature on mobile money transfer services and SMEs. The next Chapter 3 aims to present the methodology.
Chapter 3: Research Methodology
3.1 Introduction
This chapter examines the research methodology that was used in the study. It covers the research paradigm, primary research methods, sampling procedures, data collection techniques and data analysis procedures.
3.2 Research Design
The research employed both the quantitative and qualitative approach. The information required to answer the research questions was obtained through the use of questionnaires. The main difference between qualitative and quantitative research is that qualitative research generates rich, detailed and valid data that contributes to in-depth understanding of the context while quantitative research generates reliable population based data that explains cause and effect of relationships (Denzin & Lincoln 2005). Additionally, they went further to suggest that if the two are used together thus qualitative and quantitative techniques, it can help to interpret and enhance the understanding of complex reality of a given situation and implications of quantitative data. The researcher made use of both qualitative and quantitative research methods for comparative purpose.
According to Blanche, Durrheim and Painter (2006), quantitative methods allow the researcher to study chosen issues in detail, they pin point and try to understand the categories of information that emerge from the data. Additionally, as quantitative research is a deductive approach, it allows the researcher to develop concepts, insights and understanding and form patterns in the data free from determined hypotheses or theories. Taylor and Bogdan (1984) also point out that qualitative researchers try to understand people from their own frame of reference in accordance with a phenomelogy perspective which is in line with the aims of this study of implications of mobile money transfers on SMEs in Zimbabwe.
Denzin & Lincoln (2005) argue that quantitative research makes useful descriptions of observed phenomena and aims to explain the possible relationships between descriptive surveys, longitudinal developments, correlational and ex-post factors research designs. Quantitative research is an iterative process through which evidence is evaluated and theories and hypothesis are refined and tested (White,2000).In quantitative research measurement is usually regarded as the only means by which observations are numerically expressed in order to investigate casual relations or association (Denzin and Lincoln ,2005).
3.3 Research Philosophy
Bryman, (1989) describes two schools of thought associated with very different versions of research. These two schools of thought are:
a) interpretivist sociological tradition and the inductive method
b) Positivism and the hypothetic ‘ deductive method
The interpretivist sociological tradition and the inductive method, which is also known as the phenomenological paradigm is based on the assumptions that the world is socially constructed and subjective. The observer is part of what is being observed. However, the research is not value free but is driven by the interest of the researcher. According to Bryman (1989), with qualitative research it is not sufficient for the researcher to say that he or she wishes to simply describe something or to explore what is happening. Descriptions and explanations involve selective viewing and interpretation – they cannot be neutral, objective or total. The elements which a researcher chooses to see as relevant for a description or explanation is based implicitly or explicitly on the way of seeing the social world and on a particular form of explanatory logic. The above implications makes it is clear that the interpretivist sociological philosophy and its inductive mode of research is suitable for a qualitative study and is therefore not used in this research which seeks to test hypotheses. Though the social settings are more subjective and objectivity is impossible, the disadvantages of this philosophy are that there is poor reliability of findings.
On the other hand, the key idea of positivism is that the social world exists externally and that its properties should be measured through objective methods. It also seeks to test correlations among variables. The underlying assumption is that reality is rational and objective and that knowledge is only of significance if it is based on the observations of its external reality (Bryman, 1989). Easterby-Smith, (1991) asserts that from this assumption of positivism there follows a number of implications for the way research is conducted. Among the implications are the following:
a) Independence ‘ the observer is independent of what is being observed
b) Value freedom ‘ the choice of what to study and how to study it can be determined by an objective criteria rather than human beliefs and interests
c) Causality ‘ the aim of the research should be to identify casual explanations and fundamental laws that explain regularities in behaviour.
d) Nomothetic approach ‘ this intends to establish general law ‘ like findings
e) Hypothetic ‘ deductive ‘ a process of hypothesizing fundamental laws and deducing what kinds of observations will demonstrate the truth or falsity of these hypothesis
f) Operationalisation ‘ concepts need to be operationalized in a way that enables facts to be measured quantitatively.
g) Generalization ‘ in order to be able to generalize about regularities in human and social behaviour, it is necessary to select samples of a suitable size.
The table below highlights the major differences between deductive and inductive approaches to research.
Table 1: Major Differences between the Inductive and Deductive Approaches to Research
Phenomenological/Inductive Emphasizes Positivism/Deductive Emphasizes
Gaining an understanding of the meanings humans attach to events Scientific principles
A close understanding of the research context Moving from theory to data
Collection of qualitative data Collection of quantitative data
A more flexible structure to permit changes of research emphasis as the research progresses The need to explain casual relationships between variables
Less concern with the need to generalize The application of controls to ensure validity of data
Realization that the research is part of the research process The operationalisation of concepts to ensure clarity of definition
Flexibility of research Highly structured approach
Findings and results influenced by researcher philosophy Researcher independence from findings of the research
The need to capture as many elements as possible in the population The necessity to select samples of sufficient size in order to generalize conclusions
Source: Saunders (2000)
In choosing which of the two to use, Easterby-Smith et al (1991) suggested that the approach that one takes is important for the following three reasons:
a) It enables one to take a more informed decision about the research design,
b) It helps to think about those research approaches that work and those that do not, and
c) Knowledge of the difference research traditions enables one to adopt a research design that caters for constraints
This study adopted a deductive approach as it sought to test causality and hypotheses were developed to test such relationships. The data used in this study was discreet, measurable and therefore value free, which enhances objectivity; reliability and replication of findings. Also sources of data were abundant and accessible to the researcher and in any case most of it was obtained from published company reports. Deductive research is also found to be less time consuming and looked upon as a lower risk strategy, although the risk of non-return of questionnaires is present (Saunders, 2000).
3.4 Research Strategy
Saunders, Lewis & Thornhill (2009, pp600) defined research strategy as ‘the general plan of how the researcher will go about answering the research questions’. On a similar note, Bryman (2008) identified research strategy as ‘a general orientation to the conduct of research’ (pp698). Research strategy, according to Remenyi, Williams, Money & Swartz (2003), provides the overall direction of the research including the process by which the research is conducted. Saunders et al (2009) mentioned that appropriate research strategy has to be selected based on research questions and objectives, the extent of existing knowledge on the subject area to be researched, the amount of time and resources available, and the philosophical underpinnings of the researcher. Adapting a quite different approach, Yin (2003) recommended that a particular research strategy has to be selected based on three conditions; the type of research question, the extent of control an investigator has over actual behavioural events, and the degree of focus on contemporary or historical events. There are various different research strategies with distinctive characteristics available from which a researcher may select, based on the above criteria. Both Yin (2003) and Saunders et al (2009) acknowledged that although various research strategies exist, there are large overlaps among them and hence the important consideration would be to select the most advantageous strategy for a particular research study. Some of the common research strategies used in business and management are experiment, survey, case study, action research, grounded theory, ethnography, archival research, cross sectional studies, longitudinal studies and participative enquiry (Easterby-Smith et al, 2008; Collis and Hussey, 2009; Saunders et al., 2009). From these various strategies, this research sought to adopt the case study research strategy as the appropriate strategy for research.
3.5 Population and Sampling Techniques
A population is defined by Bryman (1988) as a collection of all individuals whom the researcher is interested in obtaining information and making inferences on. Fraenkel and Wallen (1996) argue that it is this group that the researcher would generalize the results of the study. The population can be in two categories, that is the target and accessible populations (Fraenkel & Wallen, 1996; Gill & Johnson, 1997) concur. The target population is the actual population upon which the researcher would generalize. However, due to logistical and possibly economic reasons, this population is not readily available. Thus the researcher is only able to generalize based on a study of a population or representative sample (Saunders, Lewis, and Thornhill, 2003). Defining the population is pivotal in assisting the researcher to select a sample for the study (Labovitz and Hagedorn, 1976). For this study the population is a highlight of all SMEs operating in Zimbabwe. To establish the implications of mobile money transfers on SMEs, the study considers SMEs that are registered with the SME Association of Zimbabwe as constituting the population from which a sample will be drawn. A sample is the number of subjects in a study. The researcher considers forty-five SMEs that operate in Chitungwiza as enough, given resource constraints to depict the implications of MMT on SMEs. The conclusions will be made from this sample as it should be representative of the whole population.
Determination of Sample Size
A minimum sample size of organizations was determined for the questionnaire administration. Either the whole population of SMEs registered with the SMEs Association of Zimbabwe would have been asked to respond to the questionnaire or a representative sample was going to be chosen to get a true picture of the situation obtaining on the ground. The latter option was taken.
There were several considerations to be made in deciding the distribution and sample size for this research. The cost of distributing and following up all the questionnaires required careful consideration. The respondents to this questionnaire were expected to have a reasonable level of appreciation of MMT in order to comprehend the questionnaire.
3.6 Sampling Techniques
Sampling techniques are methods by which the researcher can derive a sample from a population (Wegner 1995). Henry (1990) defines sampling as a process of selecting representative subset of observations from a population to determine the characteristics of the random variable under investigation. Sampling is classified into two basic methods: non probabilistic or probabilistic (Barnett 1991).
3.6.1 Non-probability sampling
In non-probability sampling technique, observations are not selected randomly. It is used where selection of the sample element is not based on mathematical chances (Wegner 1995). According to Saunders et al (2003), it is commonly used in the exploratory stages of the research project for example on pilot surveying and thereby followed by probability sampling of a homogenous population.
There are three types of non-probability sampling, namely convenience, quota sampling, and judgmental (Patton, 2002).
3.6.2 Convenience sampling
In convenience sampling, samples are drawn to suit the convenience of the researcher due to proximity and accessibility (Shiffman and Kanuk 2000). According to Henry (1990), data is collected quickly and less expensively in convenience sampling. The term ‘accidental sample’ is sometimes used but it is misleading as it carries some sense of randomness, whereas all kinds of largely unspecific biases and influences are likely to affect who get sampled (de Vaus 2002).
3.6.3 Quota sampling
In quota sampling, the population is divided into segments and a quota of observation is collected from each segment (Wegner 1995). Turner and Martin (1996) assert that in quota sampling, the strategy is to obtain representatives of various elements of a population, usually in relative proportions in which they occur in the population According to Schiffmanan & Kanuk (2000), the number of respondents is prescribed. Certain distinct population elements have to be in a sample with a certain minimum number of elements from each sub-group in the population having to be reflected. This approach was not used in this study.
3.6.4 Judgmental sampling
According to Henry (1990) and Barnett (1991), in judgmental sampling sample elements are chosen to enable the researcher to answer his or her research questions and satisfy his or her objectives. Respondents’ judgment is used to get good sources for accurate information (Schiffman and Kanuk, 2000). The researcher used his judgment to identify representative sample. It is suitable for small samples as in case study research and selecting informative (information rich) cases (Neuman, 2000). This method was used by the researcher to select the respondents of the questionnaire that will be used to answer the research questions.
3.6.5 Probability Sampling
The second sampling technique is probability sampling. The sampling method is based on mathematical chance (Saunders et al, 2003). Each and every element of the population has an equal and independent chance of being selected. According to Wegner (1995), four probability-sampling techniques are: simple, systematic, stratified and cluster random sampling. According to Wegner (1995) and Shiffman & Kanuk (2000), the main advantages of probability sampling are that it makes more explicit identification of biases and shows how much variation is introduced instead of a population. Probability sampling is however expensive and not easy to develop a sampling frame.
3.7 Data Collection Methods
The research used primary and secondary data. Primary data provides first-hand information from the respondents. The questionnaires were used to collect primary data.
Secondary data was accessed through the use of desk research where the researcher collected information on researches done in the past by other researchers in order to establish the implications of MMT on SMEs. According to Zikmund (2003), such data already exist as internal. Researches done on SMEs and how they adopt a particular technology was used. The previous researches provided information that answer the objectives of the study and provided recommendations necessary for this research.
This section describes and justifies data sources and techniques used in this study. Primary and secondary data are used to complement each other in solving research problems. Data can be classified into two categories (Wegner, 1995), internal or external and primary or secondary sources.
3.7.1 Primary Data Collection
Denscombe (1998) defines primary data as data, which is captured at the point, whilst Fraenkel and Wallen (1996) define it as data collected for a specific project. It is data generated for the first time and for a specified problem at hand. In this research primary data was obtained from questionnaires distributed to SMEs that are registered with the SMEs Association of Zimbabwe. Primary sources provide the most recent and specific data against which decisions can be made. The advantage of primary data is that it is directly relevant to a specific problem and offers greater control of data accuracy by the researcher (Jacob, 1994). However according to Patzer (1996), primary data is more expensive in terms of input resource requirements for example time and money used to collect it.
The categories of respondents were considered to have detailed knowledge and the most informed group in terms of the understanding of MMT services.
3.7.2 Secondary Data Collection
According to Patzer (1996), secondary data is collected and processed by others for purposes other than the problem at hand. Such data already exist as internal and secondary data. The advantages of using secondary data are: data is already in existence and could be accessed in a short time with no additional resource expenditure incurred to collect it (sunk costs). Shiffman & Kanuk (2000) highlight the main pitfall of secondary data as data that is not specific for the problem at hand that is to say, addressing the researcher’s specific objectives and research questions. Additional sources like questionnaires were used to compensate for the shortcomings of secondary data sources.
Secondary data was collected through a survey of literature relevant to restructuring in published books, journal articles, magazines, thesis and articles downloaded from the Internet in order to bring into context the problem under investigation. The bulk of the information on the history and empirical evidence on implications of MMT on SMEs was obtained from journals and working papers.
The study used key informant questionnaires as data collection instrument for this study.
Focus Group discussions
A focus group discussion is basically a platform which a group of selected respondent will discuss issues which will be facilitated by the researcher. The researcher had a focus group discussion with 6 SMEs that are located at Makoni Shopping Centre on the implications of mobile money transfers on their various businesses.
Questionnaires
Kervin (1999) defines a questionnaire as a data collection instrument used in survey research where people answer questions by recording their own answers. Bell (1999) and Zikmund (1997) widened the definition to include face-to-face or telephonic interviews.
Fraenkel and Wallen (1996) say the major advantage of using the questionnaire, is that it can be administered to large numbers of people at the same time. This method has also proved to be cost effective and convenient in collecting data. Foddy (1994) and de Vaus (2002) give the major disadvantages of using a questionnaire as a research instrument. First, response rate is often low as potential respondents fail to complete and return the questionnaires. Second, it is difficult to control who completes the questionnaire as questionnaires may be completed at home in the absence of the researcher. The third main disadvantage is that the respondents may find it difficult to answer particular questions since the researcher might not be available to explain where assistance is required.
This research employed the use of questionnaires for the reasons stated below;
‘ The nature of the research requires the collection of primary data at the respondent’s own free time hence questionnaires are the most applicable
‘ They collect data from more than one respondent at the same time
‘ Questionnaires are cost effective and convenient in data collection especially in this research.
In this research, the problem of reliability and clarity will be minimized by conducting a pilot survey to clarify questions and make them simple.
The nature of questions in a questionnaire is such that they precisely address research questions and objectives (Saunders et al, 2003). A questionnaire is useful in a structured data collection process and when factual information is required (Wegner, 1995).
The researcher used questionnaires. The questionnaires were administered to a total of 45 SMEs that operate in Chitungwiza. The interviewer distributed questionnaires to all SME’s in Chitungwiza who agreed to participate in the research. The interviewer provided the respondents with time approximately 30 minutes to respond to the questionnaire. The interviewer later returned to collect the questionnaires for data capture and analysis.
The questionnaires were returned upon completion. The questionnaire was designed in such a way that it captured all the objectives of the study. SMEs were guided by the questionnaire to give information on how MMT have contributed to improvements in their operations and how the introduction of MMT have changed their way of operating business. Wegner (1995)states that a questionnaire is a formal approach to measuring characteristics, attitudes, motivations, and opinions as well as past, current and possible future behaviours. The information produced from a questionnaire can be used to describe, compare or predict these facts. The design of the questionnaire will determine whether the data collected will be valid and reliable. The major advantage of using the questionnaire is that it can be administered to large numbers of people at the same time and respondents will respond to same questions, which will improve precision of the results. This method proved to be cost effective and convenient in collecting data.
3.8 Research Procedure
The researcher used tables to present qualitative data from the interviews and graphs and charts were used to present quantitative data from the questionnaire. Write ups were done on qualitative data. Silverman (2003) pointed out that qualitative data has several features to take into consideration when planning the presentation of results obtained. The data are subjective, interpretative, descriptive, holistic and copious and it can be difficult to know where or how to start (Silverman, 2003). The researcher provided a layout of the results from the questionnaire in a tabular form. Each of the responses from the questionnaire was written under a specific objective which it follows under. The researcher used Statistical Package of Social Scientist (SPSS) to capture and analyse data from the questionnaires. The SPSS produced graphs and charts to present the findings in percentages.
3.9 Research Limitations
Due to the amount of time available it was difficult to conduct many focus group discussions. In addition, it was not possible to get information from all the expected respondents, as some did not complete the questionnaire due to personal reasons. Some data was not be readily accessible as it may have been private and confidential by the SMEs concerned. However, the researcher encountered financial limitations as Small and Medium Enterprises Association of Zimbabwe, charged a fee in order for them to assist in distributing the questionnaires to their respective members.
3.10 Chapter Summary
The chapter has discussed the research design used in the study and proffered the reasons for choosing the design. The research also adopted both qualitative and quantitative research techniques. Questionnaires were the research tool used. Collected data is presented in the form of tables and graphs. The next chapter presents the research findings and it discusses the results of the study.
Chapter 4: Results and Discussion
4.1 Introduction
This chapter presents findings from the questionnaires. The study made use of a questionnaire to collect data from SMEs that operate in Chitungwiza. Amongst the various SMEs approached there were SMEs in the retail, marketing, engineering, communication and farming.
4.2 Data presentation process
In order to present the data gathered, relevant graphs and pie charts were formulated. Percentages were used to represent responses. The data obtained was both deductive and inductive. Microsoft Excel and SPSS packaging software was also used in analysing and reporting on findings.
4.3 Presentation of findings
Demographic data
The total number of respondents who were given questionnaires was forty-five and thirty-one were successfully completed and returned. Out of the 31 respondents, 18 were males while 13 were females.
Figure 3: the distribution of respondents in terms of sex
Type of businesses of the respondents
The majority of the respondents 41.9% were in the Retail business as clearly outlined by figure 4. 12.9% of the respondents were in marketing; 16.1% was found to be SMEs in the engineering business and an equal distribution of 9.7% each was from communication, services and other type of businesses.
Figure 4: Type of businesses of respondents
KEY
1-Retail
2-Marketing
3-Engineering
4-Communication
5-Services
6-Other
Number of employees of the SMEs approached
Most of the respondents (74.2%) where SMEs with employees that range from 1-10, whilst there were 9.7% of respondents having a range of 11-20 employees.
Figure 5: The number of employees in SMEs
Out of the 31 respondents, 23 respondents make use of MMT for conducting business purposes and 8 do not make use of MMT when conducting business activities. On the other hand, 27 respondents make use of MMT for personal use whilst 4 respondents do not make use of MMTs for personal reasons as highlighted in figure 4 below. The researcher went to do further computations to investigate whether the type of business might have med an impact on the adoption of MMT for business purposes. The researcher conducted a chi-square test at 95% significant level on the results and it was observed that there is a significant relationship between the type of business and the decision to adopt MMT for business purposes.
1- Represents number of respondents who use MMT for business purposes
3-Number of respondents who make use of MMT for personal reasons
Figure 6: Number of respondents who make use of mobile money transfers
Results of the further study that was done by the researcher were as below:
Test Statistics
Table 2:Table showing the test statics of chi-square
Type of business Do you use mobile transfers for Business
Chi-Square 14.871a 7.258b
Df 5 1
Asymp. Sig. .011 .007
a- 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 5.2.
b- 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 15.5.
The quantum of transactions made by SMEs per day on average
Various SMEs make use of mobile money transfers in conducting business. 75% of the investigated sample size carry out on average 1-50 transactions per day as most transactions are ranging from $1-$100 per day.
Table 3: The quantum of transactions carried out by SME respondents
Approximately how much do you transact How often do you carry out these transactions
Class interval Frequency Percent Class interval Frequency Percent
0 1 3.2 0 2 6.5
$1-100 15 48.4 1-50 24 77.4
$101-$200 10 32.3 51-100 3 9.7
$201 $-300 3 9.7 101-150 1 3.2
OVER $300 2 6.5 OVER 150 1 3.2
Total 31 100.0 Total 31 100.0
Usage of mobile money transfer services (MMTs)
Econet Wireless being the largest network provider, from the results reviewed by the questionnaire. It was revealed that 80.6% of the respondent were Econet wireless subscribers as they made use of ecocash mobile money transfer services in both conducting business and for personal use.
Figure 7: usage of mobile money transfer services
Qualifying the services rendered by mobile money operators in Zimbabwe
19.4% of the respondents view the services rendered by mobile money operators in Zimbabwe as being excellent, whilst 61.3% of the respondents are of the opinion that the services rendered are good.16.1% and 3.2 % view the services as moderate and poor, respectively.
Table 4: perception of respondents as to the quality of services rendered by MMO
Frequency Percent Valid Percent Cumulative Percent
Valid POOR 1 3.2 3.2 3.2
MODERATE 5 16.1 16.1 19.4
GOOD 19 61.3 61.3 80.6
EXCELLENT 6 19.4 19.4 100.0
Total 31 100.0 100.0
The results reviewed that a vast majority acknowledged the introduction of mobile money transfer services as they indicated that MMT had increased profits by1-10% and again a significant number of respondents also viewed MMT to have increased the business profit by 26-50%, Again some individuals 22.6% of the respondents do not acknowledge MMTs as contributing to the profits posted by their respective SME businesses as highlighted by figure 8 below.
Positive implications of MMT on SMEs
Figure 8: MMT usage in relation to % increase in profits
Table5: Positive benefits attributed to MMT usage
Has mobile money reduced losses Has mobile money increased efficiency
Frequency Percent (%) Frequency Percent (%)
Valid 0 9 29.0 0 7 22.6
1-10% 11 35.5 1-10% 3 9.7
11-25% 3 9.7 11-25% 7 22.6
26-50% 6 19.4 26-50% 6 19.4
OVER 50% 2 6.5 OVER 50% 8 25.8
Total 31 100.0 Total 31 100.0
From the table above, a greater percentage of the population 35.5% were in support of the view that MMT services reduced the losses posted by the SME. On the other hand, 29% were indifferent on whether MMTs have had an impact on the losses posted by the business.19.4% of the population .9.7% and 6.5% were of the view that MMTs reduced losses by 11%-25% and over 50% respectively. Pertaining efficiency of MMTs on SMEs, the largest sample population of 25.8% are of the view that MMTs have increased on efficiency of SME operations. 22.6% of the sample population are of the view that MMTs increased efficiency by a range of 11%-25%.Whilst, 19.4% of the sample population pointed out that MMTs increased efficiency of the SMEs by a range of 26%-50%. A sample population of 9.7% viewed that MMTs increased efficiency by a range of 1%-10%. On the other hand, 22.6% of the sample population were indifferent on whether MMTs have improved efficiency the SMEs.
Table 6 : Negative implications of MMT usage
Has Mobile money transfers decreased profit Has mobile money increased losses Has mobile money transfer decreased efficiency
Frequency Percent (%) Frequency Percent (%) Frequency Percent (%)
0 11 35.5 12 38.7 13 41.9
1-10% 16 51.6 15 48.4 13 41.9
11-25% 2 6.5 3 9.7 4 12.9
26-50% 1 3.2 1 3.2 1 3.2
OVER 50% 1 3.2 – – – –
Total 31 100.0 31 100.0 31 100.0
51.6% of the respondents viewed that mobile money transfers decreased profits in a range of 1% to 10%, whilst 35.5% did not see mobile money transfers as a threat to the profit making of the business. 6.5% viewed mobile money transfer to contribute to the decrease of the profits by 11% to 25%. The minor population of the respondents viewed it to contribute 26% and more towards the profit decrease.
Pertaining to how the mobile transfers contributed to losses, 48.4% pointed out that mobile money transfers contributed to 1% to 10% of the losses.38.7% viewed that it did not contribute to any loss making. Those who viewed that the mobile money transfers lead to loss making were 9.7% of the population of the respondents. The remaining 3.2% viewed MMT as have contributed to 26% to 50% of loss making.
Referring to whether mobile money transfer decreased efficiency, 41.9% viewed that it did not decrease efficiency. Another 41.9% viewed that MMTs contributed to 1% to 10%. Another population of the respondents of 12.9% viewed that MMTs contributed to 11% to 25%. The remaining 3.2% noted that it contributed to 26%-50% towards the decrease of the efficiency.
Mobile money service has improved the business performance in its daily operations
The researcher discovered that mobile money services has improved the operations of SMEs in Chitungwiza as 15 of the respondents strongly agreed in the view that the introduction of SMEs has improved on the business performance, whilst on the other hand 11 respondents agreed in line with the assertion that MMT improves business operations. The results are aggregated as shown below:
Table 7: Assessment MMT under various headings
Mobile money comes with many advantages to SMEs Using mobile money services is extremely easy Mobile money has improved the business performance in its daily operations I intend to use mobile money services whenever available Using mobile money enhances my effectiveness and efficiency of the business enterprise
Freq. % Freq. % Freq. % Freq. % Freq. %
STRONGLY AGREE 9 29.0 11 35.5
15
48.4 12 3.2 9 29.0
AGREE 13 41.9 12 38.7 11 35.5 13 38.7 12 38.7
NEUTRAL 7 22.6 7 22.6 4 12.9 4 41.9 10 32.3
DISAGREE 2 6.5 1 3.2 1 3.2 1 12.9 – –
Total 31 100 31 100 31 100 31 3.2 31 100
Mobile money comes with many advantages to SMEs as viewed by most of the respondents. 41.9% agreed with this statement whilst 29% were strongly agreeing with this information. However, some of the respondents were indecisive and decided to be neutral towards this, these were 22.6% of the respondents. A minor population disagreed with this and they contributed to 6.5% of the sample population. This research also tries to investigate if using mobile money services is extremely easy. 38.7% of the population agreed with this fact, whilst 35.5% strongly agreed. 22.6% however were neutral toward this and could neither agree nor disagree. Those who disagreed were 3.2% of the respondents.
This research also investigates whether mobile money has improved the business performance in its daily operations. 48.4% strongly agreed which was the greatest of the population. 35.5% agreed with this statement. Those who were indecisive contributed to 12.9%. The minority of the population viewed that did not improve the performance in its daily operations.
The researcher also investigates whether the respondents intends to use mobile money services whenever available.41.9% were indecisive whilst 38.7% agreed with this statement. Those who disagreed with this contributed to 12.9% of the population.
The researcher investigates how mobile money enhances the effectiveness and efficiency of the business enterprise. On this the respondent did not disagree with this, 38.9% of the population agreed with this. To add on 29% strongly agreed with this information and 32.3% were indecisive.
4.4 Discussions
Demographic
The research findings show the number of sample population that was used by the researcher. 58% of the respondents were males while 42% were females showing that most |SMEs are run by males rather than females. The majority of the SMEs are in retail business as revealed by the findings showing 41.9% of the respondents. Engineering had a remarkable percentage of 16.1%.
Positive benefits of MMTs on SMEs
The findings revealed that MMT come with a lot of benefits such as increased profits, efficiency and reduction in losses. From the sample population that was used by the researcher 38.7% of the respondents perceived that MMT increased the profits attained by the SMEs within the range of 1%-10% whilst on the other hand a significant number of respondents 15.5% of respondents viewed MMT as having increased the business profit by 26-50%. Efficiency is another benefit that is accrued due to usage of MMTs by SMEs. The largest sample population of 25.8% viewed that MMTs have increased efficiency of SME operations. 22.6% of the sample population viewed that MMTs increased efficiency by a range of 11%-25%.Whilst, 19.4% of the sample population pointed out that MMTs increased efficiency of the SMEs by a range of 26%-50%. A sample population of 9.7% viewed that MMTs increased efficiency by a range of 1%-10%. SMEs increased efficiency because of the reason that MMTs counter the problems associated with geographical locations in conducting businesses. Through the use of MMT the findings revealed that SMEs were in a position to conduct business with anyone within the boundaries of Zimbabwe. The focus group discussions pointed out that through the introduction of mobile technology such as MMTs, they can now pay their suppliers in less than a minute which ordinarily in the absence of MMTs they would have to travel long distances to meet the supplier. The use of MMTs by SMEs have a great impact on the efficiency of SMEs in carrying out their business transactions. The results review that 29% and 41.9% of respondents strongly agree and agree respectively with the assertion that mobile money transfers comes with a lot of advantages upon usage by SMEs and a minority of the sample population were disagreeing with this view. Other advantages associated with the use of MMT by SMEs are easy accessibility, improvements in business performance, enhance efficiency and effectiveness of business transactions. The results reviewed that 35.5% and 38.7 % of the population strongly agree and agree with the view that MMT services are extremely easy to use. The results revealed that mobile money transfers have improved the business performance of SMEs in its daily operations. 48.4% strongly agreed with this assertion, 35.5% agreed with this statement. Those who were indecisive contributed to 12.9%. However, the minority of the population viewed that usage of MMTs did not improve the performance in its daily operations.
The results obtained revealed that mobile money transfers enhances the effectiveness and efficiency of the business enterprise.38.9% of the population agreed with this and 29% strongly agreed with this information whilst 32.3% were indecisive.
Due to all these benefits that accrue to usage of MMT SMEs can affirmatively assert that they would intend to use the services whenever available. This is highlighted by the findings that 38.7% and 3.2% who agree and strongly agree to the assertion that they intend to use the service whenever available.
Negative implications of mobile money transfers on SMEs
Some of the negative impacts brought by the usage of MMTs were decreased efficiency and decreased profits.51.6% of the respondents viewed that MMT usage decreased profits by 1%-10%. These implications were as a results of problems in the network that were said to have been encountered when SMEs wanted to conduct mobile money transfer services such as payment of bills. The focus group discussion revealed that the high charges imposed on individuals when making transactions are too high thus having a negative impact on the profit recorded by the SMEs. High charges on MMT services increase the operating expenses of the enterprise, holding all things constant this reduces the profit of the SMEs. On the other hand, mobile money transfer decreased efficiency, 41.9% of the population sample viewed that MMTs contributed to 1% to 10% in the decrease of efficiency of SMEs. Another population of the respondents of 12.9% viewed that MMTs contributed to a decrease of 11% to 25% in efficiency of SMEs. The remaining 3.2% regarded that it contributed to 26%-50% towards the decrease in efficiency. The focus group discussions suggested that decrease in efficiency is as a result of problems of network that is encountered during the process of conducting business transactions. One of the members in the focus group discussion suggested that if network is congested this slows down the process of conducting business transactions thus there is reduction in efficiency.
The quantum of transactions made by the SMEs through the use of MMT
The findings revealed that a greater percent 48.4% conducted transactions within the range of 1- 100 transactions on average on a given day.
Use of mobile money transfers
Mobile money transfers can be used for both business and personal purposes by SMEs as revealed by the results that showed that out of the 31 respondents,23 made use of MMTs for business purposes and 27 out of 31 used them for personal purposes. This itself shows that MMT are used by the majority of people with SMEs
4.5 Summary of the chapter
This chapter has presented the findings and the discussions of the study. The focus groups and questionnaires were used to gather the findings. The findings were presented on the implications of mobile money transfers on SMEs in Zimbabwe: A case study of Chitungwiza. The following chapter presents the conclusions and recommendations
Chapter 5: Conclusions and recommendations
5.1 Introduction
This chapter presents the research conclusions and recommendations. The conclusions are drawn from the research findings. Possible recommendations are made for the conclusions of the research. A summary of the research is also presented in this chapter.
5.2 Summary of the research
This study sought to investigate the implications of mobile money transfers in Zimbabwe -A case study of Chitungwiza. The study was carried out in Chitungwiza. Forty-five questionnaires were administered and thirty-one were successfully completed. One focus group was carried out with the SMEs from various industries including: retail, marketing, engineering, communication and farming amongst all the other industries in Zimbabwe. The research found that MMTs have a positive impact on the operations of SMEs in Zimbabwe. This was clearly portrayed by the willingness to use MMT whenever available due to increased profits and efficiency which is brought by usage of MMTs.
Though MMTs for example ecocash is said to impose higher charges on transactions that are conducted between individuals. The benefits accrued to MMTs have managed to outweigh the disadvantages that it may have on SMEs. Ultimately, MMTs have positive impacts on SMEs which are regarded as the future of Zimbabwe as they also contribute to the GDP of the country.
5.3 Conclusion
Econet Wireless has been proved to be the mostly used network and most dominating as most of the respondents tend to use ecocash MMT services as compared to all the other service provided by other network providers. Most SMEs make use of mobile money transfer services for both business and personal use. From the results obtained from the distributed questionnaire the researcher concludes that SMEs make use of MMT because they have a positive impact on the operations of the enterprises as MMTs increase efficiency in business and profits posted by the enterprise. Ultimately, SMEs acknowledge the services being rendered by the current mobile money providers as out of the 31 respondents, 19 respondents rate the MMT services as good and 6 respondents rate the services as excellent. Amongst all the 31 respondents, only 1 respondent considered mobile money transfer services as poor this is due to high costs and network problems that may be encountered when SMEs carry out business transactions. From the results, MMTs are used for both business and personal use.74.2 % of the respondents make use of MMT for business purposes and in comparison 87.1 % of the respondents make use of MMT for personal reasons. To have a clearer view of these results, the researcher concluded that the possible reason for this was that the positive effects of increased profits greatly differ with the type of business involved. This could be by enabling them to receive payments and paying bills such as electricity and water bills. In addition, the introduction of mobile money transfer services has led to financial inclusion of the previously excluded communities, due to their convenience, low cost, accessibility and hassle-free requirements. SMEs have tend to embrace this technology of using mobile phones in their day to day operations of the business, as this is viewed as a more efficient mode of payment to services rendered by suppliers and business partners.
5.4 Recommendations
The research recommends that there is need for reduction in the charges that are imposed on individuals as they carry mobile money transaction services, as this is one of the reasons why SMEs do not fully utilize the technology of MMT services. Thus, transaction costs should be low to make the total cost of the transaction competitive. The cost incurred in conducting mobile money payments should be affordable to SMEs and far below what the banks normally charge for their bank transactions.
This study targeted a very small sector of the population of SMEs in Chitungwiza only, as discussed in the limitations of the study. The researcher is aware that the findings of this study are restricted to a rather privileged SMEs those who operate at Makoni shopping centre and Chikwanha. The plight to investigate on the implications of mobile money transfers has not been fully provided for adequately, either due to insufficient funds to carry out the research to the full potential. Research in this field should yield invaluable information currently not available. The researcher suggests that a further study should be done using a larger sample size and with adequate resources that do not turn out being the limiting factor to the study.
5.5 Summary
The chapter has provided the summary of the research, research conclusions and recommendations. The research found that introduction of mobile money transfers has Policies must therefore be formulated to regulate the charges that are imposed by each and every mobile money service provider.
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APPENDIX 1: Questionnaire
This questionnaire has been prepared by Tatenda Chirapa, an Accounting Student at the University of Zimbabwe. The purpose of the research is to investigate the implications of Mobile Money Transfers on Small to Medium Enterprises in Zimbabwe. A case study of Chitungwiza. It also serves as a part fulfilment of the academic requirements for the award for Honours Degree in Accountancy.
Kindly assist with information by filling in the attached questionnaire. Please note that this research is purely for academic purposes and all responses will be treated in strict confidence.
For any queries, additions or further discussions please to contact the writer on Cell’0774 367 176’or email: tatendamichelle@gmail.com
Section A: Administrative Section
INTERVIEWER DATE OF INTERVIEW QUESTIONRE CODE
Miss T Chirapa
Demographic Section (for the respondent)
(1)
Sex (please tick appropriately)
MALE FEMALE
_____________________________________________________________________________________
SECTION B: Responded business and Transactions
(2)
Type of business Tick
‘
Retail
Marketing
Engineering
Communication
Services
Other
(3) Number of employees in the business enterprise (tick the appropriate box)
1 to 10 11 to 20 21 to 30 31 to 50 51 to 70 More than 70
(4) Do you use mobile money transfers for?
a) Business? YES/NO””””””’
b) Personal? YES/NO””””””’.
(5) How often do you carry out these transactions?
Number Of Transactions per day Tick
‘
1 to 50
51 to 100
101 to 150
Over 150
(6) Approximately how much do you transact?
Approximate Amounts per day ($) Tick
‘
1 to 100
101 to 200
201 to 300
Over 300
(7) Which mobile money transfer service do you use most? (Tick)’
Ecocash Telecash NettCash OneWallet Other (Specify)
SECTION C: Mobile Money Effects on Business
(8) How would you rate the quality of services rendered by mobile money transfer service providers?
(Define the ratings)
Poor Moderate Good Excellent
(9) Could you suggest a reason for your rating above?
…………………………………………………………………………………………………………………………………………………
””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””’…
(10) How has mobile money transactions changed your business?
Positive effects
1 to 10% 11 to 25% 26 to 50% Over 50%
Increase Profit
Reduced Losses
Increase Efficiency
Other (Specify)
(11) Negative Effects
1 to 10% 11 to 25% 26 to 50% Over 50%
Decrease Profit
Increase Losses
Decrease Efficiency
Other (Specify)
(12) The following tables have statements about mobile money services. Rate your agreement with each of the statements by using the scale provided in the table.
1= (SA) Strongly Agree, 2= (A) Agree, 3= (N) Neutral, 4= (D) Disagree, 5= (SD) Strongly Disagree
STATEMENT SA A N D SD
1 2 3 4 5
Mobile money services have improved the business performance in its daily operations
I intend to use mobile money services whenever available
Mobile money comes with many advantages to small and medium business enterprises.
Using mobile money enhances my effectiveness and efficiency of the business enterprise.
Using mobile money services is extremely easy
(13) What is your highest concern over the use of mobile money transfer services”””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””””?..”””””””””””””””””””””””””””””””””””
Your participation is greatly appreciated.
Appendix 2: Focus Group Discussion Questions
1. What are the negative effects of mobile money transfers to SMEs?
2. What are the benefits of mobile money transfers to SMEs
3. How has the harnessing of mobile money transfer services in Zimbabwe improved the quantum of financial transactions by SMEs?