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International Journal of Research and Innovation in Social Science (IJRISS) |Volume VI, Issue X, October 2022|ISSN 2454-6186

Assessment of the Effect of Agency Banking on Commercial Banks’ Performance in Sokoto Metropolis, Nigeria

Ibrahim S. Muhammad (PhD)1, And Ganiyu Leke Bello2
1Department of Economics, Shehu Shagari College of Education, Sokoto – Nigeria
2Department of Management Sciences, The National Open University of Nigeria, Sokoto – Nigeria

IJRISS Call for paper

Abstract: The study assessed the effect of agency banking on commercial banks’ performance in Sokoto Metropolis. A survey design was used to carry out the research. The study used a judgmental sampling technique and simple random sampling to pick five respondents from the senior management staff, five employees from operational level staff, and twelve agents for each of the five selected commercial banks. Thus, 110 respondents were selected from five selected banks (Guaranty Trust Bank (GTB), Access Bank Plc, Zenith Bank Plc, First Bank of Nigeria (FBN), and Diamond Bank Plc). A questionnaire designed was used to collect data on a four-Likert scale rating. Descriptive statistics were used in form of percentages, mean, tables, and frequency counts, and inferential statistics inform the t-test to analyze the data. Results of the analysis indicate that agency banking has led to the accessibility of financial services to many customers, particularly in non-banking rural areas which has improved banks’ performance. It was concluded that access to effective financial service delivery to customers is a prerequisite to banks’ performance which can only be achieved by improving agency banking networks, especially in non-banking areas. The study recommends the need for banks’ management to further improve customers’ accessibility to effective financial service delivery.

Keywords: Agency banking, performance, commercial


The banking sector is very crucial for the growth of the economy of any country. The country’s financial system is composed of financial institutions, such as; banks, insurers, financial markets, market infrastructures, pension, supervisory and regulatory authorities. As saving and investment channels, these components of the financial system provide a roadmap for carrying out various economic transactions and in so doing support economic growth (IMF, 2019). According to the World Bank (2012), the financial system strengthens the economic growth and resource allocation of a country by offering reliable and accessible information with lowering transaction costs; therefore, a stable financial system is a pre-condition for sustainable economic growth.
Banks in developing countries like Nigeria operate in a highly dynamic and competitive environment. Due to the similarity of financial products and services, it is difficult for banks to differentiate from competitors and create a competitive advantage. As a result, the movement towards a customer-based strategy has become crucial not only in attracting