Effects of Savings Mobilization on Financial Performance of Saccos in Kenya

Abstract

This study's goal was to determine how consumer behavior in form of savings mobilization affected the financial performance of SACCOs in Kenya. The study was of great importance, since SACCOs contribute greatly to a nation’s economic development, by making funds available to as many people as they can through advancement of loans and savings mobilization. Over the past few years, financial performance of many SACCOs has been on a declining trajectory as many have folded, raising questions as to whether the strategies employed to sustain them are working. Savings mobilization has been one of these strategies making it possible to undertake this study. Descriptive correlational research design was used, focusing on 10 DTS that were licensed by SASRA, and had been in operation for the last five years. SPSS was used to examine secondary data that was obtained from the SASRA website. The research results suggested that the financial performance of SACCOs in Kenya was not significantly affected by the mobilization of savings. According to the study’s recommendation, SACCOs will have to provide savings solutions that are easy to use, adaptable, competitive, liquid, and appealing and that continuous training and or in-service courses should be mounted for SACCO staff to equip them with product knowledge and customer care services which will impact financial performance.