Factors influencing financial performance of savings and credit cooperative societies. A case of capital sacco, Meru county, Kenya

Abstract

Savings and credit cooperative societies have been present in Kenya for decades but this sector has not been able to impact positively on the lives of people. Access to finance has been cited as one of the factors hampering economic growth and poverty alleviations. Savings and credit cooperative societies have lagged behind other financial institutions by performing below the members’ expectations therefore causing dissatisfaction among the members. The purpose of this study was to establish the factors influencing financial performance of savings and credit cooperative societies. The study was guided by the following objectives, to establish how loan repayment influence financial performance of SACCOs, to determine how interest rates influence financial performance of SACCOS, to assess how membership enrolment influence financial performance of SACCOs, to establish how duration of loan processing influence financial performance of SACCOS, to identify how management of loan defaulters influence financial performance of SACCOS. Descriptive research design was used in this study where information was collected without changing the environment. The population was drawn from capital SACCO, meru branch staff, management committee and members. Capital SACCO meru branch has 25 staff, 7 directors and 4800 members. A sample of 298 respondents which consist of 5 staff,3 directors and 290 SACCO members was considered . Questionnaires were administered and collected later for data analysis and presentation through tables and summarized percentages and proportions.