Influence of Digital Banking on the Performance of Caritas Microfinance Bank in Nairobi Archdiocese, Kenya

Digital banking has become critical drivers of digital financial inclusion by improving access to financial services, enhancing operational efficiency, and strengthening institutional performance. This study examined the influence of digital banking on the performance of Caritas Microfinance Bank in Nairobi Archdiocese, Kenya. The study was anchored on the Technology Acceptance Model and adopted a convergent parallel mixed-methods research design. The target population comprised 1,250 respondents, including clients, bank managers, parochial leaders, and diocesan officials. A sample of 278 clients was selected through simple random sampling, while 12 key informants were purposively selected for qualitative interviews. Quantitative data were collected using structured questionnaires and analyzed using descriptive statistics, Pearson correlation, and multiple linear regression in SPSS version 25 after satisfying diagnostic assumptions. Qualitative data were analyzed thematically and integrated with quantitative findings through triangulation. The study achieved an 89.9% questionnaire response rate, with 250 completed questionnaires and eight key informant interviews. The findings established that digital banking had a positive and statistically significant influence on the performance of Caritas Microfinance Bank and emerged as the strongest predictor of institutional performance with a beta coefficient of 0.523 and a p-value of less than 0.001. The study concludes that strengthening digital banking services can substantially improve operational efficiency, customer satisfaction, and overall institutional performance. Therefore, the study recommends continued investment in secure digital platforms, customer digital literacy, reliable ICT infrastructure, and supportive management strategies to maximize the benefits of digital banking. Keywords: Mobile banking, internet banking, digital financial inclusion, institutional performance, microfinance bank