EFFECT OF DIGITAL PAYMENT SYSTEMS ON THE COMPETITIVE ADVANTAGE OF COMMERCIAL BANKS IN NAIROBI

Abstract: The main objective of the study was to determine the effect of digital payment systems on the competitive advantage of commercial banks in Nairobi, Kenya. The research recognizes that Kenya’s banking sector operates in an increasingly digitalized and competitive environment, driven by fintech innovations, changing customer expectations, and technological advancement. A mixed-methods research design was employed, combining quantitative and qualitative data collected from managers and IT specialists across top-tier banks in Nairobi. Statistical analysis using SPSS was conducted to examine the relationship between digital payment and competitive advantage. The results reveal that digital payment explain a significant proportion of the variance in competitiveness among banks. Digital payment systems showed a strong positive effects. The study concludes that while digital technologies are critical enablers of competitiveness, their effectiveness depends on complementary factors such as organizational culture, employee skills, and regulatory support. The findings provide actionable insights for banks to refine their digital systems for better market performance and offer policymakers a framework for promoting innovation while maintaining financial stability. Ultimately, the research contributes to the growing body of knowledge on digital systems in emerging economies, emphasizing its role in achieving sustainable competitive advantage in Kenya’s banking sector. Keywords: Digital Payment, Competitive Advantage, Commercial Banks. Title: EFFECT OF DIGITAL PAYMENT SYSTEMS ON THE COMPETITIVE ADVANTAGE OF COMMERCIAL BANKS IN NAIROBI Author: Dianah Injendi Manyengo, Ann Omamo, Antony Sije International Journal of Social Science and Humanities Research ISSN 2348-3156 (Print), ISSN 2348-3164 (online) Vol. 13, Issue 4, October 2025 - December 2025 Page No: 367-374 Research Publish Journals Website: www.researchpublish.com Published Date: 14-November-2025 DOI: https://doi.org/10.5281/zenodo.17608747 Paper Download Link (Source) https://www.researchpublish.com/papers/effect-of-digital-payment-systems-on-the-competitive-advantage-of-commercial-banks-in-nairobi