Articles: Department of Business

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Analysis of factors influencing access to credit services by women entrepreneurs in Kenya
(IISTE, 2014) Karanja, John Gakuu; Mwangi, Anthony Kiragu; Nyakarimi, Samuel N.
The purpose of this study was to analyze the factors influencing access to credit services by women entrepreneurs in Kenya; a case of Isiolo town. Entrepreneurship has been regarded as a major contributing factor to the economic growth and poverty alleviation both in urban and rural areas. Organizations for Economic Co-operation and Development (OECD) reports indicate growing phenomena of women entrepreneurship both in developed and developing countries. In some countries, women-owned businesses are increasing at a very rapid pace in terms of both numbers and turnover. The scope of the study was selected from financial lending institutions in Isiolo County and women entrepreneurs targeting those who are members or have accounts in these financial institutions. There are 6 registered FIs operating within the Isiolo town which has a total of 18 management employees and 20 registered women entrepreneurs. The researcher conducted a census on the FIs managers and as well as women entrepreneurs in Isiolo town from the target population. To analyze the data, the researcher applied the chi-square testing the hypothesis of the study. The study recommends that the financial institutions should establish lending procedures which will attract women entrepreneurs and accommodate them in access of credit. It also recommended that the financial institutions should encourage the use of affordable collaterals that will ensure that women entrepreneurs are able to access credit. Lack of affordability collateral was one of the challenges that was highlighted as hindrances to women accessing credit. The financial institutions should ensure that they train women entrepreneurs on investment opportunities in order to increase purposes of credit for women entrepreneurs. This will ensure women entrepreneurs will always have a purpose to do with credit advanced to them by financial institutions.
Application Of Internal Control System In Fraud Prevention In Banking Sector
(2020-03) Nyakarimi, Samuel N.; Kariuki, Samuel N.; Kariuki, Peter
The main purpose of the study was to establish the effect of internal control system on fraud prevention in banking sector in Kenya. The study involved all the banks where branch managers, operations managers and cash supervisors were sought for the study. The study analysed 117 questionnaires from respondents. Factor analysis was used to reduce the number of variables for analysis purposes. Correlational research study and structural equation model were applied in the study to establish the relationship between variables and in analysis of hypotheses. The study found that control environment and control activities have no statistically significant effect on fraud prevention whereas risk assessment, monitoring of activities and communication of information have statistically significant effect on fraud prevention. Discussions based on the results and related studies were provided. Limitations of the study were highlighted. Recommendations based on the findings were provided. The recommendations were on policy, practise and further research in the same or related areas.
Assessment of Financial Factors Affecting Insurance Penetration in Nakuru Town, Kenya
(2016-09) Njuguna, G. W.; Kimani, Elijah M.
Over the past decade, insurance and banking firms have undergone transformation in the manner they offer their products and services in a bid to remain relevant in the insurance industry. Kenya, just like many developing countries is still at the infancy stages of absolute insurance cover. Records indicate that majority of Kenyans are presently not under any insurance cover. The study assessed the effect of financial factors on insurance penetration in Nakuru town, Kenya. The financial factors examined included administrative costs and agency costs. Blau administrative cost theory, agency theory, and S-curve theory guided the study. This study adopted a cross-sectional survey research design. The study focused on the 417 employees working with insurance firms in Nakuru town. A sample of 61 respondents was selected using stratified random sampling method. The study used a self-administered semistructured questionnaire to collect data. The research questionnaire was pilot tested. Data analysis constituted both descriptive statistics and inferential statistics. Descriptive statistics included means, modes and standard deviations. Inferential statistics included Pearson’s Product Moment Correlation and multiple regression analysis. Findings were presented in tables. The study found that all the financial factors investigated had significant relationship with insurance penetration. The study concluded that insurance firms incur administrative and agency costs that hamper insurance penetration. The study recommended that insurance firms need to arrest escalating costs associated with administrative functions and agency.
Bandwidth selection in smoothing functions
(2006) Kibua, T.K.; Karuku, M.
A simple criterion for selecting a bandwidth parameter that controls the amount of smoothing in functions is described. The procedure is computationally inexpensive and, hence, worth adopting. We argue that the bandwidth parameter is determined by two factors: the kernel function and the length of the smoothing region. We give an illustrative example of its application using real data.
Basic Capabilities Effect: Collective Management of Pastoral Resources in South Western Kenya.
(Elsevier, 2016-03) Kihiu, Evelyne N.
Collective action, such as common resource user groups, has gained importance in the management of pastoral natural resources. This study aims at analyzing the effects of basic capabilities, among other factors, on households' decisions to participate in collective management of pastoral resources in Narok County, Kenya. A zero-inflated beta model, in addition to alternative econometric model specifications, is applied on cross-sectional data collected through a household survey. The results confirm the key role of the capability concept in explaining the management of natural resources. Increased basic capabilities, that is, the ability to achieve some minimally acceptable levels of functioning reduce cooperation levels in collective management of pastoral resources. Social capital, neighborhood social influences, resource system characteristics, socioeconomic factors and institutional factors also emerge as key determinants of collective management of pastoral resources. Policy implications drawn by this study encourage strategies to build social capital and facilitate adoption of improved range management technologies where communal management of land is likely to be abandoned for exclusive property rights.
Corporate Social Responsibility Strategy And Financial Performance Of Deposit Taking SACCOs In Kenya
(2015-08) Kinyua, Jesse M.; Amuhaya, Iravo; Namusonge, Gregory
This study sought to establish the relationship between Corporate Social Responsibility strategy and the financial performance of deposit taking Savings and Credit Co-operatives societies in Kenya. The SACCO subsector is part of the Kenyan Co-operative sector comprising of both financial and non financial cooperatives. Saving and credit co-operative (SACCO) are the financial cooperatives. They are an important part of the financial sector in Kenya, providing savings, credit and insurance services to a large portion of the population. Stakeholder management is paramount in creating trust and confidence to key stakeholder especially in deposits taking SACCOs and in keeping them satisfied. It has been argued that CSR has an indirect influence in determining whether or not a company is or remain successful or not. Descriptive research method and inferential analysis was used in this study. Questionnaires ware used to collect primary data. To ensure that the research instrument yields valid data, the researcher engaged expert in the relevant field in scrutinizing it. The designed instrument was counter checked by the supervisor and peers in the area of specialization. Pilot study was carried out to check on the reliability and validity of the instrument and a Cronbach‘s Alpha of 0.915 was obtained. Data was collected from a sample of 54 Deposit taking SACCOs out of a population of 180 licensed DTS. This made a sample of 130 respondents. Collected data was then edited in the field to clean it up. Data was processed using descriptive analysis and multiple regression analysis performed to determine the relationships between the stakeholder generic strategies and performance of SACCO societies. Data analysis was done using Statistical Package of Social Science (SPSS) Version 20. Research findings were that CSR strategy has positive relationship with the performance of deposit taking SAACOs. The research contributes to both stakeholder management and CSR theories by supporting previous studies that stakeholder management strategies have positive relationship with SACCO societies‘ performance. The study offered practical recommendations to managers to be proactive in stakeholder management and to adopt CSR as a strategy to enhance various relationships and financial performance of their SACCOs.
Determinants of Corporate Capital Structure among Private Manufacturing Firms in Kenya: A Survey of Food and Beverage Manufacturing Firms
(Human Resource Management Academic Research Society, 2014-07) Kamau, Guandaru C.; Kariuki, Samuel N.
The purpose of this study was to investigate factors influencing corporate capital structure in private firms in Kenya. Although the capital structure issue has received substantial attentio n, it is noteworthy that most of the empirical work done focuses on data derived from developed economies that have many institutional similarities and their applicability in developing markets such as Kenya is not documented. Yet, the maintenance of an optimal capital structure is considered as one area where decision makers can influence the company’s value and risk. Specifically, the objectives of the study were to establish whether growth opportunities, firm size, firm profitability, and asset tangibility influence corporate capital structure. The study adopted a descriptive survey research design. The study population comprised 121 Food and Beverage private manufacturing firms registered with the KAM that are located in Nairobi and surrounding area. A sample of 36 firms was selected for the survey using stratified random sampling technique from which 30 questionnaires were returned. Primary data was sourced through personally administered questionnaires to the CFOs. Data was analyzed using descriptive statistics and inferential statistics. Multiple regression analysis was used to determine the interplay between the independent variables and dependent variable. Based on the findings, the study concludes that growth opportunities positively influence capital structure; firm size negatively influences the capital structure, there is an insignificant negative relationship between firm profitability and the capital structure, and there is insignificant positive interaction between asset tangibility and the capital structure of private firms in Kenya.
Determinants of Corporate Cash Holdings: Evidence from Private Manufacturing Firms in Kenya
(GreenField Advanced Research Publishing House, 2015-06) Kariuki, Samuel N.; Namusonge, Gregory S.; Orwa, George O.
Cash is an important requirement to ensure continued operations, yet excessive cash holdings might result in many problems which include; higher opportunity costs of holding cash, cash abuse, a tool for obtaining the controlled self-interests and the higher agency costs. The study established that there is a negative and insignificant linear relationship between growth opportunities and corporate cash holdings. The study also revealed that leverage is a significant positive determinant of corporate cash holdings in line with the precautionary motive. In regard to firm size, the study findings indicate that firm size positively determines corporate cash holding. Further, the study revealed that there is a negative linear relationship between likelihood of financial distress and cash holdings. The findings also confirmed a positive relationship between cash flow variability and corporate cash holdings. The study therefore concludes that; leverage, firm size, likelihood of financial distress and cash flow variability determine corporate cash holdings among private manufacturing firms in Kenya.
Determinants of Group Loans Uptake at The Youth Enterprise Development Fund
(2015-10) Kilele, Andrew K.; Nduruhu, David; Kimani, Maina E.
The Government of Kenya has established the Youth Enterprise Development Fund and other Government Funds to help reduce unemployment rate among the youth. Despite this effort by the government, the uptake of these funds remains low. The study intended to f ind out the determinants of group loans uptake at the Youth Enterprises Fund in Nakuru West Constituency. The accessible population was drawn from the registered youth groups in Nakuru West Constituency which are 520 in number. Primary data was collected by use of structured questionnaires. Data was analyzed using both descriptive statistics and inferential statistics. SPSS was used to process and analyze the data. According to the findings, lending procedures and policy was found to have the most significant effect on the group loan uptake while financial literacy training had the least effect on loan uptake. It was recommended that the management of the Youth Enterprise Development Fund should come up with appropriate means to reach and communicate to the youths; start up loan amount should be increased so should the loan repayment period; the management should also come up with suitable lending procedures and policy that are friendly to the youths and finally youths should be trained on financial literacy so as to increase group loans uptake at the Youth Enterprise Development Fund.
Determinants of Service Delivery in the Health Sector among Selected Counties in Kenya
(2017-11) Bengat, Joseph K.; Nassiuma, Bernard. K.; Kwonyike, Joshua
This study investigated determinants of service delivery in the health sector in Kenya.The study examined the effect of Public-Private Partnership (PPPs), Transfer Pricing, New public management in Service Delivery. The research adapted pragmatism paradigm, Research approach utilized was mixed method approach, design. Research utilized was s descriptive survey design, target population consisted of health workers 1,740, a sample size of 314 respondents was adopted from a thesis. Analysis was employed by Structure Equation Modeling.Findings: Two null hypotheses were rejected hence Public-Private Partnership positively affects Service Delivery. Transfer Pricing model was reliable and had good fit, (NFI = 0.912); New public management posted low CFI and GFI. Ant-Image for (PPP, TP& NPM posted: ai = 0.970, = 0.980 &=0.620) respectively. Results for transfer pricing indicate that ratio index, 2.15 is less than 5, in other words the model is a good fit. The relative chi-square should be 5 or less to reflect good fit or acceptable fit. New public management indicate ratio index , 6.30 more than 5 indicating a model of not good fit its, CFI .890, NFI, 0.7 lower than threshold . Public-Private Partnership had ratio, 1.907 which is less than 5 in other words the model is a good fit. Its also indicates NFI= 0.900, and GFI = 0.911.The study concludes that new public management loaded poorly hence the variable had lower weight as a predictor compared to the two predictors. Transfer pricing strongly influences Service Delivery, but its model is not fit. All in all the three constructs: PPP and TP are good contributors to Service Delivery, New public management loaded poorly with a lower weight and weak association compared to other predictors. This research recommends that New Public Management should be further researched.
Determinants of tax compliance by small and medium businesses in Embu County, Kenya
(2019-04) Kariuki, Samuel N.; Njeru, Zachary Mukundi J.
Small and medium enterprises are a key engine of economic growth in both developing and developed countries. Small and medium businesses being profit making institutions are expected to pay taxes to the government. Therefore, tax compliance is critical in all economies which recognize the role played by revenue collected from tax in national development. Nonetheless, developing countries are dominated by low tax compliance levels, in the face of the frequent appeal from tax collectors for voluntary compliance. As a result, identification of tax evasion approaches and ways to diminish it is one of the central aims of many governments’ agenda with the view of achieving higher levels of compliance. As such, many governments have embraced administrative measures such as fines, penalties, rates and tax audits to enforce tax compliance. Interestingly, despite the phenomenal growth of small and medium businesses, the tax collection from the sector is still low. This study therefore, sought to establish the determinants of tax compliance among small and medium businesses in Embu County, Kenya. The study sampled 185 enterprises in Embu County using stratified random technique. The findings show that fines and penalties, tax compliance costs and tax knowledge and education significantly influence tax compliance among small and medium businesses in Embu County. The study recommends that the Kenya Revenue Authority should prepare education and training programs to ensure that small and medium businesses embrace voluntary compliance with all the tax requirements. Further, the study recommends that Kenya Revenue Authority should also evolve policies to decrease tax compliance cost incurred by small and medium businesses to avoid curtailing their growth potential and inspire voluntary tax compliance.
Earning Management: Analysis of Non-Banking Firms Listed in Nairobi Securities Exchange using Beneish M-Score and Altman Z-Score
(2021-02) Nyakarimi, Samuel N.
Earning management or manipulation has been that has been used for a long time by the management of various firms to adjust financial reports to meet certain objectives. This practice has been used even for fraudulent and selfish activities. The purposes of the research were to ascertain the levels of earning manipulations and financial distress of non-banking firms listed in Nairobi securities exchange. The latest financial statements were used as the source of information. The Beneish five-variable model was used to determine the presence of earning manipulations. Altman’s Z-Score was used to test the financial distress. The analysis revealed that 58.3% of the firms were not involved in earning manipulations. Further data showed that 41.7% of the analysed firms were in financial distress. The study recommends restitutions by fraud perpetrators through earning manipulations, change of auditors approach to certification of financial reports by including ratios calculations and financial bailout by the government and owners of the businesses in case of financial distress based on economic hardships.
Effect of adoption of Financial Innovation on Performance of small and medium Enterprises in Kenya
(2016-04) Kimani, Elijah M.
Small and Medium Enterprises (SMEs) are the main drivers of economic and social development in emerging economies. They represent a large number of businesses in a country that generate wealth and employment. They are widely considered vital to a country’s competitiveness. SMEs are hailed for their pivotal role in promoting grassroots economic and equitable sustainable development (Pelham, 2010). According to Tufano (2013), innovation entails firms developing new products or new production processes to better perform their operations, in which case the new products could be based on the new processes. Adoption of financial innovation has been necessitated by the rapid change in technology. The SMEs have adopted new strategies of sustaining their growth due to stiff competition. Most SMEs have adopted innovation resulting in better performance, new products, growth and profitability (Lehtimaki, 1991). The objective of the study was to determine the effect of adoption of financial innovation on performance of small and medium enterprises in Kenya. The study adopted Schumpeter theory of innovation, Diffusion of Innovation and Technology acceptance theory to explain the relationship between financial innovation adoption and performance of SMEs in Kenya. The population of the study was the registered SMEs in Nairobi County. Primary data was collected using self-administered semi-structured questionnaires. Secondary data was collected from finance journals and 2 periodicals. Data analysis was done using Statistical Package for Social Sciences (SPSS) version 21 where inferential statistics were applied and multiple regressions employed to test the relationship between innovation and the financial performance of SMEs in Nairobi County. The findings revealed a positive relationship between adoption of financial innovation and performance of SMEs in Kenya. The study concluded that innovation has a positive effect on financial performance. The study also concluded that innovation increased profits for the company; innovation increases the company’s market share, increases savings for the company and reduces operating cost of the small and medium manufacturing enterprises. The study recommends that it is vital for businesses to take up innovation to raise the level of quality of the products they produce which would in the end raise the level of sales and increase the profit margins of the business.
The Effect of Credit Information Sharing on Loan Performance in Commercial Banks in Nairobi County
(2015) Gachora, Susan
Information remains a crucial input in the banking industry. Banks are confronted with asymmetric information problems because of borrowers' informational opacity. Banks overcome this problem by accumulating information about their borrowers' creditworthiness, using their superior ability to collect and process information. Obtaining useful unique information about their borrowers can be costly for banks, but it provides a competitive advantage and a source of rents over the lifetime of the relationship. Commercial banks play a pivotal role in the economy in the intermediation process by mobilizing deposits from surplus units to deficit units. The surplus is channeled to deficit units through lending. Lending is the main activity of commercial banks in Kenya. The Kenyan banking sector was in the 80’s and 90’s saddled with a momentous Non-Performing Loans (NPLs) portfolio. This invariably led to the collapse of some banks. One of the catalysts in this scenario was “Serial defaulters”, who borrowed from various banks with no intention of repaying the loans. Undoubtedly these defaulters thrived in the “information asymmetry” environment that prevailed due to lack of a credit information sharing mechanism. Credit Reference Bureaus complement the central role played by banks and other financial institutions in extending financial services within an economy. CRBs help lenders make faster and more accurate credit decisions. They collect, manage and disseminate customer information to lenders within a provided regulatory framework – in Kenya, the Banking (Credit Reference Bureau) Regulations, 2008 was operationalized on 2nd February, 2009. The Regulations govern licensing, operation and supervision of CRBs by the Central Bank of Kenya. The development of a sustainable information sharing industry is therefore recognized as a key component of financial sector reforms in almost all developing and emerging economies. It is on this background that this study was carried out to establish the effects of Credit Information Sharing (CIS) on performance of loans in Commercial Banks in Nairobi County in Kenya. Specifically, the study aimed to investigate the effects of Credit Information Sharing (CIS) on loan uptake, interest rates, default rates and the use of collaterals as security to loans. The study was carried out on 35 commercial banks in Nairobi County. The results indicate that improved screening effects from the CIS system caused the level of loan portfolio arrears to decline after it was implemented in most banks. The Researcher also observed an even more substantial and significant effect of the information system in reducing late payments that occur during the loan cycle.The researcher also found out that when information is shared by an information exchange institution, such as credit bureaus and public credit registers, the higher competition drives down interest rates and reduces benefits derived from otherwise monopolistic information. Credit Information Sharing allows banks to better distinguish between good and bad borrowers and over time, potential borrowers with a "Good Credit Report" or "Good Credit History" are able to access loans more cheaply and easily than high risk defaulters.
The Effect of Credit Information Sharing on Loan Performance in Commercial Banks in Nairobi County.
(2015) Gachora, Susan
Information remains a crucial input in the banking industry. Banks are confronted with asymmetric information problems because of borrowers' informational opacity. Banks overcome this problem by accumulating information about their borrowers' creditworthiness, using their superior ability to collect and process information. Obtaining useful unique information about their borrowers can be costly for banks, but it provides a competitive advantage and a source of rents over the lifetime of the relationship. Commercial banks play a pivotal role in the economy in the intermediation process by mobilizing deposits from surplus units to deficit units. The surplus is channeled to deficit units through lending. Lending is the main activity of commercial banks in Kenya. The Kenyan banking sector was in the 80’s and 90’s saddled with a momentous Non-Performing Loans (NPLs) portfolio. This invariably led to the collapse of some banks. One of the catalysts in this scenario was “Serial defaulters”, who borrowed from various banks with no intention of repaying the loans. Undoubtedly these defaulters thrived in the “information asymmetry” environment that prevailed due to lack of a credit information sharing mechanism. Credit Reference Bureaus complement the central role played by banks and other financial institutions in extending financial services within an economy. CRBs help lenders make faster and more accurate credit decisions. They collect, manage and disseminate customer information to lenders within a provided regulatory framework – in Kenya, the Banking (Credit Reference Bureau) Regulations, 2008 was operationalized on 2nd February, 2009. The Regulations govern licensing, operation and supervision of CRBs by the Central Bank of Kenya. The development of a sustainable information sharing industry is therefore recognized as a key component of financial sector reforms in almost all developing and emerging economies. It is on this background that this study was carried out to establish the effects of Credit Information Sharing (CIS) on performance of loans in Commercial Banks in Nairobi County in Kenya. Specifically, the study aimed to investigate the effects of Credit Information Sharing (CIS) on loan uptake, interest rates, default rates and the use of collaterals as security to loans. The study was carried out on 35 commercial banks in Nairobi County. The results indicate that improved screening effects from the CIS system caused the level of loan portfolio arrears to decline after it was implemented in most banks. The Researcher also observed an even more substantial and significant effect of the information system in reducing late payments that occur during the loan cycle.The researcher also found out that when information is shared by an information exchange institution, such as credit bureaus and public credit registers, the higher competition drives down interest rates and reduces benefits derived from otherwise monopolistic information. Credit Information Sharing allows banks to better distinguish between good and bad borrowers and over time, potential borrowers with a "Good Credit Report" or "Good Credit History" are able to access loans more cheaply and easily than high risk defaulters.
Effect Of Financial Innovations On Performance Of Microfinance Institutions In Nakuru Town, Kenya
(Journal of Business and Management, 2016-10) Kimani, Elijah M.; Kibugo, Martin K.
Abstract: Innovation is described as the process by which, firms master and implement design, and the production of goods and services that are new to them. Innovations generally assume different forms such as product innovations, marketing innovations, micro MFIS, location innovation, and research and development innovation. Financial innovations include institutional innovation, product innovation, and process innovation. These innovations have eased the way of doing business for financial institutions including microfinance institutions. It remains largely unclear whether MFIs are adequately innovative in running their businesses given that they are faced by the challenge of limited growth and expansion. Performance and growth are related in that a firm cannot grow if it fails to post sound performance. The general objective of the study was to determine the effect of financial innovation on performance of microfinance institutions in Kenya. Specific objectives include examining the effect of institutional innovation, product innovation, and process innovation on performance of microfinance institutions. The study was guided by theory of induced institutional innovation, demand-supply theory of innovation, theory of innovation diffusion, and economic value added theory. Descriptive survey research design was used in this study. The target population comprised of all employees working with MFIs registered with AMF-Kenya and the accessible populations were 187 employees working with MFIs registered with AMF in Nakuru town, Kenya. Samples of 70 respondents were drawn from the study population using stratified random sampling technique. The study used questionnaire as the tool for primary data collection. Secondary data was collected using a data collection sheet. A pilot study was conducted before the main study with the aim of determining the reliability and validity of the research instrument. The study determined the validity of the questionnaire by use of content validity test. Reliability was tested using the Cronbach alpha coefficient. Data processing and analysis was facilitated by the use of the Statistical Package for Social Sciences. Data analysis encompassed both descriptive statistics and inferential statistics. Descriptive statistics such as means, mode, standard deviations, and variance was used. On the other hand, inferential statistics was in form of Pearson’s correlation coefficient, and multiple regression analysis. The result of the analysis was presented in form of tables, charts, and graphs. From the findings, the research concluded that there is a supervisory framework that monitors MFIs. Some of the innovations observed by MFIs in mobile banking include partnerships, financial trainings, branch networking and opening up new branches. It is was also concluded that innovations can be a source of competitive advantage if a firm understands customer needs, competitors’ actions and technological development and act accordingly to stay at par with rivals. The study recommended that in-order to enhance firm performance the management of microfinance ought to focus on the firm activities aligned towards renewing routines, procedures and processes in an innovative manner in a firm. This will positively improve the performance of microfinance.
Effect of Government Regulations on the Relationship Between Return on Investments and Financing of Water Investments In Nairobi Peri-Urban Markets in Kenya
(2014) Kimani, Maina E.; Ngugi, Nahashon; Matumo, Gabriel
For any economic development it is important to finance infrastructure such as water and sanitation. Water has historically been viewed as public good not as a market commodity and thus water utilities have not been able to generate sufficient internal revenue to ensure sustainable financial investment. There is a low level of investment in the sector by both public and private players especially in peri-urban areas in Kenya. Many people in these areas still do not have access to basic water resulting to millions of illnesses and death every year from water related issues. Scarcity of water in peri-urban areas has created investment opportunity yet there is little participation of private players. The study explored effect of government regulations on the relationship between return on investments and financing of water investments in Kenya. The study adopted cross-sectional survey research design. The accessible population for this study was 1500 small scale water providers registered by Water Service Regulatory Board. A two stage sampling technique was used to obtain a sample population of 150 small scale water service providers. The study utilized self administered semi-structured questionnaire and content analysis for collecting data. Structure Equation Modelling (SEM) was used to measures the relationship between return on investments and financing of water investments. The findings of the study indicated government regulations influences financing of water investments, low return on investments, among small scale water service providers limits supply of water in peri-urban markets. It was therefore recommended that the government should enhance tariff reviews, performance monitoring and efficient metering and billing. This would lead to high return on water investments. Water utilities will thus be able to generate sufficient internal revenue to ensure sustainable financial investment. The results of the study will be of great importance to both public and private water utilities. This will contribute to greater understanding of various challenges that the utilities go through in trying to make water accessible to peri-urban population.
Effect of liquidity management on liquidity of savings and credit co-operative societies in Kirinyaga County, Kenya
(2017-05) Githaka, John M.; Maina, Kimani E.; Gachora, Susan
Savings and Credit Co-operative Societies (SACCOs) are quasi financial institutions that mobilize savings, provide loans as well as other products to their members. Liquidity is considered as one of the serious concern and challenge for the modern era SACCOs. A SACCO having good asset quality, strong earnings and sufficient capital may fail if it is not maintaining adequate liquidity. The objective of the study was to assess the effect of liquidity management on liquidity of Savings and Credit Co-operatives Societies in Kirinyaga County, Kenya. Descriptive survey research design was used in this study. The target population consisted of all the 60 registered SACCOs in Kirinyaga County from which a sample size of 18 SACCOs was drawn. The study employed stratified random sampling technique. Primary data was collected by use of self-administered semi-structured questionnaires while secondary data was collected using audited financial statements of the SACCOs and regulator (SASRA). A pilot test was conducted to ascertain the validity and reliability of questionnaire. The Cronbach’s alpha coefficient was used for reliability test while the content validity technique was used in validating the research instruments. The data was analyzed using SPSS with the help of descriptive statistics tools such as percentages, mean, standard deviation, mode and variances. Inferential statistics was done by use of Pearson’s product moment of correlation. Multiple regression analysis was performed to assess the relationship between study variables. R2 was used to assess the contribution of independent variable on dependent variable. Data was presented using frequency tables, charts and graphs. The F-test was used to evaluate the significance of the obtained results. The study findings will be of great importance to the SACCO management, academicians and future scholars, regulator and the government. The study indicated that the effect of liquidity management, net cash flows, credit lending and investment in non-core business on liquidity of SACCOs was positive and significant. The study concluded that SACCOs in Kirinyaga County mostly capitalized on liquidity management and as such it affected the SACCOs’ liquidity. In addition, the study concluded that it was critical for SACCOs to have adequate liquidity in order to ensure that they meet short term maturing obligations. The SACCO management must put in place financial strategies to ensure that liquidity is effectively managed on a regular and timely basis and that appropriate policies and procedures are established to limit and control material sources of liquidity risk.
Effect of Loan Repayment on Financial Performance of Deposit Taking SACCOs in Mount Kenya Region
(International Journal of Innovation and Applied Studies, 2015-03) Njeru, Mugambi Duncan; Njeru, Agnes; Member, Florence; Ondabu, Ibrahim Tirimba
This study sought to explore the effect of Loan Repayment on financial performance of deposit taking SACCOs in Mount Kenya Region. The target population was all the thirty licensed deposit taking SACCOs in Mount Kenya Region, the sampling technique employed was simple random sampling and the sample size was 92 respondents. This study adopted a descriptive survey in soliciting information on effects of Loan Repayment on financial performance of deposit taking SACCOs in Mount Kenya region. Primary quantitative data was collected by use of self-administered structured questionnaires. The researcher also used secondary data derived from the audited financial statement of the SACCOs and the regulator (SASRA). The data collected was analyzed, with respect to the study objectives, using both descriptive and inferential statistics. The researcher concluded that there is need for the regulator to introduce credit policy for the sector, this will help in controlling credit risks among the SACCOs in the sector and reduce credit exposure on guarantors. Currently huge percentage of credit risk is on the guarantors but since the sector is on upward trend on growth, there is need to strengthen the sector by adoption of better and efficient credit management system and will ensure the sector is competitive across the Kenyan financial sector.
Effect of Technology and Information Systems on Revenue Collection by the County Government of Embu, Kenya
(2017) Karimi, Harriet; Maina, Kimani; Kinyua, Jesse
Improvement of revenue collection in counties is the key to meeting their financial obligations leading to realization of their mandate to offer quality and timely services to the residents, the demand for which may exceed the available resources. Many counties have adequate revenue bases to finance the current level of services, but revenue collection levels are often low. According to reports by the Controller of Budget, revenue collection by 14 counties in Kenya fell below amounts generated by the former local authorities under their respective jurisdictions during the 2013/2014 financial year. In addition, the analysis showed that most counties failed to meet their local revenue collection targets. Several counties have been slammed with labour strikes and go-slows among their workforce due to delayed salaries and/or poor remuneration of employees working under the county governments. The purpose of this study was to establish the effect of technology and information systems on revenue collection by County governments INTRODUCTION in Kenya. The study was guided by technology acceptance theory. The study employed a descriptive survey research design. The target population of the study comprises all county government employees in Kenya. Purposive sampling and simple random sampling was used to select 102 respondents for the study. Content Validity was used as a validity test while Cronbach alpha coefficient was used for reliability test where a reliability coefficient of 0.7 was obtained and accepted. Data was collected using self-administered semi-structured questionnaires. Overall; it was found that technology and information systems had the effect on revenue collection. The study recommends a revision of the County’s Act and the integration of information systems in the management activities of Embu County. The findings of this study shall be beneficial to county governments as they were in a position to establish corrective measures and formulate policies to harness revenue collection.

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