An assessment of ATM network expansion strategies on service coverage in banking: a case study of AB Microfinance Bank
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Background of the Study:
Expanding ATM networks is a strategic approach employed by banks to enhance service coverage, particularly in regions where access to traditional banking is limited. AB Microfinance Bank has focused on broadening its ATM network to improve service accessibility and financial inclusion among underserved populations. Between 2023 and 2025, the bank has implemented innovative expansion strategies, including deploying solar-powered ATMs and partnering with local businesses to host machines, aimed at reaching remote and rural areas (Adeniyi, 2023; Okeke, 2024). This initiative is critical in bridging the gap between urban financial centers and rural communities, thereby promoting economic empowerment.
The bank’s strategy involves integrating digital monitoring tools to track ATM performance, optimize location selection, and ensure prompt maintenance. Enhanced service coverage through an expanded ATM network not only improves customer convenience but also increases transaction volumes and overall revenue generation. However, challenges such as infrastructural deficiencies, network connectivity issues, and inconsistent maintenance practices can hinder the effectiveness of expansion efforts. These obstacles can lead to uneven service quality and reduced customer satisfaction, ultimately affecting the bank’s competitive position.
This study aims to assess the impact of ATM network expansion strategies on service coverage at AB Microfinance Bank by analyzing performance metrics, geographic coverage data, and customer satisfaction levels. The research will identify key barriers to effective expansion and propose strategies to overcome these challenges, ensuring that the bank’s efforts translate into enhanced financial inclusion and operational efficiency (Ibrahim, 2025).
Statement of the Problem:
Despite significant ATM network expansion efforts, AB Microfinance Bank still faces challenges in achieving comprehensive service coverage. In rural areas, issues such as poor network connectivity, irregular maintenance, and infrastructural deficits hinder ATM performance, leading to inconsistent service quality (Okeke, 2024). These challenges not only diminish customer satisfaction but also limit the bank’s ability to promote financial inclusion among underserved populations. Variability in ATM performance across different locations suggests that expansion strategies may not be uniformly effective, resulting in gaps in service delivery. Furthermore, the cost of maintaining an extensive ATM network and the challenges of integrating new technologies with existing infrastructure add to the operational burden, reducing the overall benefits of network expansion.
This study will examine the effectiveness of AB Microfinance Bank’s ATM network expansion strategies by evaluating service coverage and customer feedback. It will identify the main obstacles affecting ATM performance and propose strategies to optimize network management and maintenance, ultimately improving service reliability and financial inclusion outcomes.
Objectives of the Study:
To assess the impact of ATM network expansion on service coverage at AB Microfinance Bank.
To identify challenges hindering effective ATM performance in rural areas.
To recommend strategies for improving network maintenance and service consistency.
Research Questions:
How does ATM network expansion affect service coverage?
What infrastructural challenges limit ATM performance in rural regions?
What measures can optimize ATM maintenance and operational consistency?
Research Hypotheses:
H1: ATM network expansion significantly increases service coverage.
H2: Infrastructural deficits negatively impact ATM performance.
H3: Enhanced maintenance protocols improve overall service reliability.
Scope and Limitations of the Study:
The study focuses on AB Microfinance Bank’s ATM network from 2023 to 2025. Limitations include regional infrastructure disparities and potential inconsistencies in maintenance practices.
Definitions of Terms:
ATM Network Expansion: The increase in the number and distribution of ATMs across a region.
Service Coverage: The extent to which banking services are accessible to customers.
Financial Inclusion: The process of ensuring that all segments of society have access to affordable financial services.
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