Abstract:
Agency banking was formally launched in Kenya by Central Bank of Kenya in 2010 as an implementation of a financial
inclusion policy. The policy aimed at increasing financial services outreach by promoting financial inclusion to the un-banked and
under-banked population especially the bankable youths that stood at 61.3% as of 2009. By 2020, eleven years since agency
banking was first adopted it is not clear whether the objectives of the policy had been achieved. Therefore, the overall objective of
this study was to determine the impact of agency banking adoption on financial inclusion of the youths in Kenya. The study was
guided by the diffusion of innovation theory. The study adopted an exploratory non-experimental research design. The study used
secondary data and the nature of the data collected was quantitative. The data targeted 14 commercial banks that were licensed
by Central Bank of Kenya to carry out agency banking as of December 2014. The data was collected from CBK banks supervision
annual reports and from financial reports of the 14 commercial banks using a data collection worksheet and analyzed using
descriptive and inferential statistics. The empirical model of the study was based on Event study. The study found that agency
banking had a positive impact on financial inclusion of the youths in Kenya.
