Effects of Mobile Money on Mobile Money Operators in Makindye Division Kampala, Uganda; a Case Study Of
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EFFECTS OF MOBILE MONEY ON MOBILE MONEY OPERATORS IN MAKINDYE DIVISION KAMPALA, UGANDA; A CASE STUDY OF AIRTEL, KABALAGALA BRANCH BY KANSIIME HARRIET 1163-05014-06333 A RESEARCH REPORT SUBMITTED TO COLLEGE OF ECONOMICS AND MANAGEMENT IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF A BACHELOR’S DEGREE IN BUSINESS ADMINISTRATION OF KAMPALA INTERNATIONAL UNIVERSITY JULY, 2019 DECLARATION I, Kansiime Harriet heart fully declare that this report is in its original status through the field work and data analysis I undertook. It has never been produced and presented anywhere for the academic awards in this university or elsewhere including other higher institutions of learning. SIGNATURE ~. DATE . .~ I0~ / ~ KANS TIME HARRIET 1163-05014-06333 APPROVAL I, certify that the research report has been submitted by Kansiime Harriet with my approval and it’s ready for submission in the college of economic and management. SIGNATU~ ~ DATES ~4i/.~ DR.KIRABO KYEYUI’JE B. JOSEPH (SUPERVISOR) DEDICATION I dedicate this piece of work to my parents Mrs. Kabaloodi Oliver sisters Christine, Irene, Dorren and my brothers Christopher and Godwine who have fought their deliberations to have courage and fortitude and kept struggling in spite of odds in seeing my dreams of education fully realized. III ACKNOWLEDGEMENT First and foremost, I pass a word of thanks to the almighty God for being there for me always in my academic career for this success I count on today. I extend a vote of thanks to a number of people who unreservedly, contributed towards the accomplishment of this research work. I also would like to acknowledge the assistance and role played by the following personalities to the successful completion of this study. I cannot say exactly how grateful I am to my supervisor, Dr.Kirabo Kyeyune B. Joseph; his guidance in this study was beyond measure. Thank you also for providing me with professional advice, encouragement and your time that has spurred me to success. In the same way, I would like to thank the management and staff of Makindye Division Airtel, Kabalagala Branch and the proprietors of the selected businesses for the time they gave me most especially in evenings after the long day’s work. They honestly filled the questionnaires, surely, without their input; this study would not have come to fruition. I cannot forget the efforts of the staff of Kampala International University main campus especially the lecturers and the management department and my friends at large, the BBA for their input and effort that made me acquire the invaluable knowledge. Your contribution can never be quantified but will always be reminiscent whenever I look through this book. Lastly, I thank my parents for sacrificing the little they had, in thick and thin and invested in my education. This sacrifice that you made failed in other peoples’ homes. Thank you for looking after me and enabling me to acquire a lifelong investment. iv LIST OF TABLES Table: 3.1 Showing sample size 22 Table: 4.1 Response rate 27 Table : 4.2 Findings on the gender of respondents 28 Table : 4.3 Findings on the age of respondents 29 Table : 4.4 Findings on the level of education 30 Table : 4.5 Shows the distribution by Marital Status 31 Table : 4.6 shows the effect of mobile money tax to the Airtel Company 32 Table : 4.8 showing the effect of mobile money tax to the mobile money customers 34 Table: 4.9 Shows the effect of mobile money tax to mobile money Agents 36 V LIST OF FIGURES Figure: 2.1 Conceptual Frame work 10 Figure :4.1 showing the response rate 28 Figure : 4.3 Age of the respondents 29 Figure :4.4 showing the level of education 30 Figure :4.5 Shows the distribution by Marital Status 31 vi LIST OF ACRONYMS IT Information Technology KACITA: Kampala City Traders Association LED Local Excise Duty MMOs Mobile money operators MMT Mobile Money Transfers IvfNOs Mobile Money Operators PEOU Perceived Ease of Use PU Usefulness TAM Theory of Technology Acceptance Model LICC, Uganda Communications Commission URA Uganda Revenue Authority VAT Value Added Tax VII TABLE OF CONTENTS DECLARATION APPROVAL DEDICATION ACKNOWLEDGEMENT iv LIST OF ACRONYMS vii TABLE OF CONTENTS ABSTRACT CHAPTER ONE 1 [NTRODUCTION 1 1.0 Introduction 1 1.1 Background to the study 1 1.1.1 Historical background Perspective 1 1.1.2 Theoretical perspective 2 1.1.3 Conceptual Perspective 3 1.1.4 Contextual Perspective 4 1.2 Problem statement 1.3 Purpose of the study 6 1.4 Specific objectives 6 1.5 Research Questions 6 1.6 Research Hypotheses 6 1.7 Scope of the Study 6 1.7.1 Geographical scope 7 1.7.2 Content scope! theoretical scope 7 1.7.3 Time scope 7 VII 1.8 Significance of the Study .~ 1.9 Operational definition of key terms 8 CHAPTER TWO 9 LITERATURE REVIEW 9 2.0 Introduction 9 2.1 Theoretical Review 9 2.1.1 Technology Acceptance Model 9 2.2 Conceptual Framework 10 2.2.1 Review of related literature 11 2.2.1.1 Financial Inclusion 11 2.2.2 Empirical review of literature 11 2.2.3 Research gaps 13 2.3 Mobile Money Taxation 13 2.3.1 Negative effects of Mobile Money Services Usage 16 2,4 Effect of mobile money tax to the mobile money customers 17 2.5 Effect of mobile money tax to the mobile money agents 18 ~HAPTER THREE 21 VIETIIODOLOGY 21 3.0 Introduction 21 3.1 Research Design 21 3.2 Population of the Study 21 3.3 Sample Size 21 3.4 Sampling Techniques 23 3.5 Sources of data 23 3.5.1 Secondary data Collection 23 ix 3.5.2 Primary Data collection 23 3.6 Data Collection Methods 23 3.6.lQuestionnaire Method 24 3.6.2 Response rate 24 3.7 Measurement of Variables 24 3.7.1 Validity of Instruments 24 3.7.2 Reliability of Instruments 25 3.7.3 Data Validity 25 3.8 Data Analysis 25 3.9 Ethical considerations 25 3.10 Limitation of the study 26 CHAPTER FOUR 27 DATA PRESENTATION, ANALYSIS AND INTERPRETATION 27 4.Olntroduction 27 4.1 Response rate 27 4.1.1 Background Information 28 4.1.2 Age of the respondents 29 4.1.3 Response on the level of education of the respondents 30 4.1.4: Distribution by Marital Status 31 4.2 To determine the effect of mobile money tax to the Airtel Company 32 4.3 To examine the effect of mobile money tax to the mobile money customers in Kabalagala. 4.4 To establish the effect of mobile money tax to mobile money Agents in Kabalagala 36 4.5: Data analysis and findings 38 x CHAPTER FIVE .39 SUMMARY, CONCLUSION AND RECOMMENDATIONS 39 5.0 Introduction 39 5.1 Summary of findings and interpretation 39 5.1.1 Objective one 39 5.1.2 Objective two 39 5.1.3 Objective three 40 5.2 Conclusion 40 5.3 Recommendations 41 5.4 Limitation of the study 42 5.5 Areas for further research 43 REFERENCES 44 APPENDICES 49 APPENDIX I 49 QUESTIONNAIRE 49 APPENDIX II: BUDGET 53 APPENDIX III: WORK PLAN AND TIMEFRAME 54 xi ABSTRACT The purpose of the study was to assess the effect of mobile money tax to mobile money users in Uganda in accordance to Airtel Uganda Kabbalagala perspective. The study was based on three specific objectives; to determine the effect of mobile money tax to ‘he Airtel Company, to examine the effect of mobile money tax to the mobile money customers in ~(abalagala and to establish the effect of mobile money tax to mobile money Agents in ~abalagala It was based on a cross sectional descrz~tive survey design basing on the use of iualitative and quantitative approaches those mobile money operators in Makindye division, 4irtel Uganda Kabbalagala. Simple random sampling and purposive sampling techniques were ised in the study. Questionnaires were used to collect primary and secondary sources of data ‘I~om 50 out of 60 respondents, using simple random sampling. Data analysis was done using ~‘FSS~frequencies, Finally the report looked at the study results and gave the discussion ofeach ?nding. Therefore, here, data analysis, procedures and response rate are focused on. ~hen the findings according to objective one revealed that high taxes paid by mobile money perators reduce their profits which had a negative effect on the Mobile money company in ~.‘Iakindye division Kabalagala branch with 68% of respondents who strongly agreed and 20% igreed. According objective two, the positive effect ofMo bile money reduces financial pains and lifficulties in making payment indicate that customers are convinced with Cash flow ~ianagement thus the credit management and have greatly increased overtime by response of ~8% and there are suggestions with mobile money, the poor have a simple and safe way to save “money for future healthcare costs and has greatly increased overtime by 59%.According to ~bjective three, on average of the effect of mobile money to agents is that they face the problem ffraud by the customers in Airtel money Kabalagala branch in Makindye Division Kampala )istrict a negative effect that mobile money agents have no security in their operation of their ervices to customers and the findings over 73% levels of agreement on the areas provided / tudied or selected and those who agreed with 15%. Having gone through this topic, it was easonable to conclude that mobile money is increasingly becoming a critical part of the ation ‘s economy. It also serves as a source ofgovernment revenue and as such any tax imposed hould not inhibit or limit the development of the industry.