Financial Technology Adoption And Performance Of Investment Management Firms In Kenya

Abstract

This research examines the influence of financial technology (FinTech) on firm performance. Though financial technology adoption has been postulated to have an impact on firm performance, this assertion has not been sufficiently proven in the literature. The study’s context is Kenya’s investment management firms. The primary objective of the study was to assess the effect of FinTech on firm performance. The study's specific objectives were to evaluate the impact of blockchain technology, artificial intelligence, big data analytics, and mobile technology integration on the performance of investment management firms in Kenya. Each objective had a corresponding hypothesis tested at a 95 per cent confidence level. The study adopted the innovation diffusion, and task technology fit theories. The study also applied the technology acceptance model. It used a descriptive cross-sectional survey, targeting all 107 investment firms in Kenya. Primary data was gathered through a five-point Likert scale questionnaire. Diagnostic testing was done and descriptive, correlation and multiple regression analyses were conducted. Multivariate analysis showed that blockchain technology had a significant positive impact on the performance of investment management firms in Kenya. Likewise, integrating mobile technology also showed a significant positive impact on firm performance. In contrast, big data analytics and artificial intelligence showed a positive, statistically insignificant impact on firm performance. The study offers recommendations for theory, policy and managerial practice. It encourages management to prioritize specific technologies for firm performance improvement. However, the study; 's limitations include a cross-sectional design that restricts long-term observations, suggesting that future research should adopt a longitudinal approach and expand to include various industries and regions for broader applicability.