IJSSER

Title: EFFECT OF MOBILE BANKING SERVICES ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SACCOS IN KENYA
Authors: Everline Anyango Odipo, Dr. Onesmus Mutunga
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1Everline Anyango Odipo, 2Dr. Onesmus Mutunga 1. School of Business, University Of Nairobi. 2. Lecturer, School of Business, University Of Nairobi.
MLA 8 Odipo, Everline Anyango, and Dr. Onesmus Mutunga. "EFFECT OF MOBILE BANKING SERVICES ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SACCOS IN KENYA." Int. j. of Social Science and Economic Research, vol. 5, no. 5, May 2020, pp. 1186-1222, ijsser.org/more2020.php?id=83. Accessed May 2020. APA Odipo, E., & Mutunga, D. (2020, May). EFFECT OF MOBILE BANKING SERVICES ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SACCOS IN KENYA. Int. j. of Social Science and Economic Research, 5(5), 1186-1222. Retrieved from ijsser.org/more2020.php?id=83 Chicago Odipo, Everline Anyango, and Dr. Onesmus Mutunga. "EFFECT OF MOBILE BANKING SERVICES ON FINANCIAL PERFORMANCE OF DEPOSIT-TAKING SACCOS IN KENYA." Int. j. of Social Science and Economic Research 5, no. 5 (May 2020), 1186-1222. Accessed May, 2020. ijsser.org/more2020.php?id=83.
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Abstract: The Sacco industry in Kenya has experienced growth in recent times through a tremendous rise of the quantity of licensed Deposit-Taking SACCOs (DTS) in Kenya as from when laws authorizing their establishment came into being in 1931. Over the years, these SACCOs have faced stiff competition for its customers from banks and other similar institutions offering financial services. Hence with the increased information technology innovations such as mobile phones, these SACCOs have had to adopt mobile banking as a mechanism of not only enhancing their operational efficiency but eventually improving their performance in terms of finances. The study required to find out effect of mobile banking services on the financial output of DTS in Kenya. It used descriptive research design such as mean, standard deviation and inferential statistics. Population of the study was the 166 DTS registered with SASRA by 31st December 2018 and a sample of 117SACCOs were chosen through simple random sampling for inclusion into final sample. Secondary data comprising of the audited financial statements and reports for the sampled SACCOs ranging from the year 2015 to the year ending December 2018 obtained from SASRA were used in the study. Descriptive and inferential analysis methods were used. Multiple regression analysis was done to identify how phone banking adoption financially impacts the performance of Kenya's licensed DTS. It was established that MBS, asset protection, asset quality, capital adequacy, liquidity, costs and Sacco size positively influence financial performance in DTS and explained 69.4 percent of variations in financial performance while 30.6 percent is due to other factors not in the model. Capital Adequacy and Liquidity were found to know the financial performance of DTS to a greater extent. It was found that DTS growth in assets, deposits and loans is gradual. It concluded that mobile banking has enhanced the level that DTS reach members especially in the provision of deposit and withdrawal services as well as limited digital credit by a few deposit taking SACCOs and recommends that the SACCOs that are yet to adopt the innovation should do so.

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