Abstract:
The aim of this study is to examine factors influencing deposits mobilization in Private
commercial banks. Specifically the study evaluated the impact of Awareness creation, Interest
Rate, Branch Expansion and Technology on deposit mobilization.
This case study employed a quota sampling technique, where 46 bank staff were sampled.
However, the study captured 46respondents from seven branches of private commercial banks at
Arba Minch town were selected as representatives in this study.
The results from the analysis of bank officials’ shows that Awareness Creation and branch
expansion, Interest Rate and Service level &Technology used are among the most important
factors to facilitate deposit mobilization. Also the hypotheses have a positive impact on deposits
growth was strongly supported by the results of this study. Regression results were presented,
where t-statistics and standard deviation were used to support and strengthen the professional
arguments.
From the study, recommendations are made on improvement on Technology used in financial
institutions to allow more utilization of electronic money and credit cards. The study
recommends also Private commercial banks to design a way to make neglected semi-urban and
rural population to get the banking services, and outsourcing some of the operational activities
like mobile phone banking and Automated Tellers Machine (ATM) and Agent Banking for easing
deposits mobilization and saving unnecessary expenses. The study also recommends that bank
should increase deposit interest rate to attract more deposits in the banks after consultations
with central bank.
