The Moderating Effect of Industry Regulations on the Relationship between Technology Deployment Strategies and Performance of Commercial Banks in Kenya

Abstract

Abstract This study investigated the moderating effect of industry regulations on the relationship between technology deployment strategies and the performance of commercial banks in Kenya. The study adopted a quantitative research design and was guided by the Unified Theory of Acceptance and Use of Technology (UTAUT). Primary data were collected through structured questionnaires administered to selected commercial banks in May 2025. The analysis employed regression modeling to test moderation effects. The findings revealed that regulatory frameworks significantly enhance bank performance by fostering creativity, inclusivity, and resilience. Key legal instruments influencing technology adoption include the Kenyan Constitution (2010), the Prudential Guidelines (2013), and the Digital Credit Providers Regulations (2022), which supported the financial sector's stability during shocks such as the COVID-19 pandemic. The study recommends updating outdated policies, such as the Banking Act (2015) and the Prudential Guidelines (2013), to accommodate emerging technologies like fintech, blockchain, and artificial intelligence. Additionally, policymakers are urged to enhance financial inclusion through financial literacy programs, localized digital innovations, and targeted support for marginalized groups, including women-led enterprises.