Digitalization on Performance of Financial Institution in Rwanda. Case of Bank of Kigali and Savings and Credit Cooperative (SACCO) of Musanze District

This study investigates the effect of digitalization on the performance of financial institutions in Rwanda, focusing on the Bank of Kigali and SACCOs in Musanze District.Findings from the study show that the adoption of mobile banking and online banking significantly improves profitability, liquidity, and capital adequacy.Mobile banking, with its broad accessibility, is particularly influential in increasing transaction volumes, leading to higher profitability.Online banking and digital payment systems contribute to enhanced customer engagement and satisfaction, with customers reporting ease of use and reliability.Investment in cybersecurity has improved the financial stability of institutions by reducing risks of data breaches and fraud, thereby positively impacting capital adequacy ratios and overall financial security.Furthermore, operational efficiency has markedly improved, with significant reductions in transaction processing times and operational costs.Cybersecurity measures have enhanced risk management capabilities, reducing the likelihood of fraud and improving institutional risk resilience.The study concludes that digitalization plays a critical role in enhancing the financial performance of institutions in Rwanda.Based on these findings, it is recommended that financial institutions continue to invest in digital technologies, with a particular emphasis on enhancing cybersecurity frameworks to protect against emerging risks.Institutions should also focus on improving customer experience by investing in user-friendly digital platforms that cater to customer preferences.