Corporate Governance, Customer Service, Financial Innovation And Profitability At Pride Microfinance Limited, Uganda

Abstract

This study investigated the effect of corporate governance, customer service, and financial innovation on the profitability of Pride Microfinance MDI Limited in Uganda. The following objectives guided the study: i) to examine the relationship between corporate governance and profitability at Pride Microfinance Limited (MDI), Uganda; ii) to examine the relationship between financial innovation and profitability at Pride Microfinance Limited (MDI), Uganda; and iii) to examine the relationship between customer service and profitability at Pride Microfinance Limited (MDI), Uganda. The study adopted a cross-sectional research design. The study population was 5,320, and the sample size was 366 respondents. Questionnaires and interviews were the main research instruments for this study. Data analysis was conducted using frequency and percentage tables, the mean and standard deviation, and the Pearson correlation technique. This study revealed a positive and significant relationship between corporate governance and the profitability of PMI (r =.688*, p =.000). The study further revealed a significant and positive relationship between financial innovation and the profitability of PMI (r =.704**, p =.000). Similarly, the study revealed a positive and significant relationship between customer service and the profitability of PMI (r =.694**, p =.020). The study revealed that corporate governance, financial innovation, and customer service as a whole significantly influence PMI's profitability by a variance of 55.9% (R2 =.559, p =.000). The study concluded that corporate governance, financial innovation, and customer service positively and significantly affect the profitability of Pride MFI. The study made the following recommendations: increase in board number to ten members; gender balance; board independence; introduction of credit or debit cards; promotion of awareness campaigns on mobile banking; and providing professional training to staff members so as to be more professionally responsive and empathetic in dealing with customers.