Historical Background of the Study Topic

On a global scale, mobile banking has been introduced in many banking sector in different
countries. To improve their performance, the banking sector has developed a number of
innovations over the last few years, which have improved efficiency and, in the long run,
financial performance (Ernest & Young, 2020). Mobile banking has been a key component of
these innovative products (McDonald & Schumacher, 2017). According to Lee, Lee, and Kim
(2017), mobile banking is the practice of providing financial services through the use of mobile
phones. Financial institutions in the United Kingdom, for example, have implemented mobile
banking merely as an extension of their online channels, as have their counterparts around the
world Rahman (2018). In Finland, mobile banking services included checking account balances,
transferring funds, paying bills, trading stocks, managing portfolios, and purchasing insurance
(Lee et al., 2017). According to Yin and Zhengzheng (2019), as a result of technological
advancements, Chinese commercial banks have transitioned from wholesale credit operations to
retail credit operations. Globally, despite the benefits that m-banking has brought to improving
the quality of services provided to customers by service providers, a number of challenges have
arisen. In Bangladesh, for example, a number of barriers to M-commerce were identified,
including a lack of literacy, trust, and a conflict of interest among both telecommunication
service providers and banks. According to Chandran (2019), the obstacles of using e-banking in
the Indian banking sector include inadequate guidelines provided by banks to customers, high
transaction processing charges, unpredictable networks, noted theft, and illiteracy among citizens
in rural areas.

In Africa, various countries adopted mobile phone banking particularly in financial institution. In
Nigeria, Mobile banking has improved e-Commerce and e-Payment systems, reducing the
amount of currency in circulation (Chiemeke, 2016). According to Padachi and Seetanah (2018),
the Mauritius Commercial Bank and the State Bank of Mauritius improved their financial results
after implementing mobile banking. Financial institutions, which have struggled to provide
profitable services to poor clients through traditional channels, see mobile as a form of
"branchless banking" (Ivatury & Mas, 2020), In Kenya, Graham (2016) contended that through
MPB, customers can obtain services such as account information-which includes mini statement
inquiries and checking of account history, alerts on account activity or passing of set thresholds,
monitoring of term deposits, access to loan statements, access to card statements, mutual
funds/equity statement, insurance policy management, and pension plan management.

In Tanzania, since 2008, mobile network operators (MNOs) and various Bank Plcs have
established the majority of mobile banking services. Vodacom, Tigo, Airtel, TTCL, Halotel, and
Zantel are some of the current mobile phone operators. All mobile service providers provide a
wide range of mobile banking services, including utility charge payment and fund transfer
(Kingu, 2021). Zantel, for example, launched a mobile banking service called "Z-Pesa," which
translates to "Zantel Money." M-Pesa, which was launched in April 2008, came after that.
Furthermore, in February 2009, Airtel Tanzania launched Airtel-Money as its mobile banking
service (Airtel, 2009). Tigo Co. Ltd. also launched Tigo Pesa, a mobile banking service, in 2010.
Individual customers and service providers alike benefit from mobile banking services. Benefits
could include reduced time spent and faster transactions when paying bills such as school fees,
electricity and water utilities, thanks to an established link with Tanzania Network Electrical
Supply Co. Ltd (TANESCO) and its LUKU electricity utility. Face-to-face banking is now
avoided by obtaining similar banking services through an appointed agent via mobile phone.

CRDB bank is one amongst the commercial banks which uses electronic banking and has been
attractive to many bank stakeholders because it accepts deposits and makes loans (Lyimo &
Mbesigwe, 2022). CRDB's Bukoba branch has nearly 18,253 customers with personal accounts,
15,666 of whom have subscribed to various mobile phone networks and are also subscribers to
the MPB system (CRDB Report, 2019). It was expected that the provision of mobile banking
services would result in cost savings, improved performance, broader coverage, revenue growth,
customer convenience, and profit maximization. Mramba et al. (2014), on the other hand, point
out that, because there is no direct relationship between mobile phone ownership and the use of
mobile phones in business, there is a need to train teenagers, particularly primary and secondary
school leavers, on how to use mobile phones in a business context. This study therefore aimed at
examining the benefits and challenges of MPB usage in the CRDB Bukoba branch of Tanzania.