The Effects of Culture on the Profitability of Commercial Banks in Kenya

Nancy Onchiri1, Dr. Grace Okello2, & Dr. Michael Ngala3
1,2,3 The Co-operative University of Kenya, Kenya
DOI – http://doi.org/10.37502/IJSMR.2024.71115

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Abstract

Culture profoundly shapes organizational effectiveness and profitability in Kenya’s commercial banking sector. This study explores the interplay between organizational culture, national cultural factors, and customer culture in influencing bank performance. A customer-centric culture, motivated workforce, and participative leadership enhance customer satisfaction and loyalty, contributing to profitability. Similarly, national cultural traits like trust, risk aversion, and ethnic diversity significantly influence banking practices. Furthermore, Kenya’s tech-savvy consumer base demands convenience and digital innovation, prompting banks to adapt to cultural dynamics for sustained success. The findings provide a comprehensive framework for understanding the cultural dimensions impacting profitability in Kenya’s banking sector.

Keywords: Organizational culture, customer-centric, national culture, profitability, Kenya banking

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