An empirical study of factors affecting growth of savings and credit co-operative societies in Kenya: the case of Laikipia County

Abstract

While the Kenya cooperative sector has developed rapidly in the recent past, no one has investigated the slowed growth of SACCOs. Hence this research project investigated on factors that affect SACCOs growth. They include; Information technology, Dividend policy, Implementation of projects, Response to competitive forces and Area of opelation. The study employed both correctional and descriptive survey designs. A total of 31 SACCOs in Laikipia County were studied where out of a possible 93 respondents, a 50% sample was taken totaling to 47 respondents. The main tool of research was a. questionnaire while the model of the research was multiple regression.

Data was analyzed using inferential and descriptive statistics such as: mean mode, median and correlation coefficient. Qualitative data was analyzed thematically to address the research questions while the quantitative data was analyzed to test hypothesis and check correlations. This was with the help of the Statistical Package of Social Sciences (SPSS). The results were that all the variables contributed positively to the slowed growth of SACCOs. The main contributor was dividend policy which according to the data, contributed 67.4%.

It was thus concluded that the main hindrance to growth of SACCOs was inadequate capital base made worse by payment of high dividends in cash form. The main recommendation was that both the government and the SACCOs need to come up with policies that can enhance the SACCOs capital base. Further research could be carried out on how the SACCOs can raise funds considering that they are not quoted in the stock market and the commercial banks interest rates were phenomenally high.