Abstract: Savings and Credit Cooperative Societies (SACCOs) have played a vital role in the economy through the provision of savings and credit facilities to the medium and low income earners. It is this important role that drove the researcher to want to find out the effect of liquidity management on the financial performance of SACCOs in Kenya. The target population of the study was Non Deposit Taking (NDTS) SACCOs in Mombasa County taken to be a representative of all NDTS SACCOs in Kenya. The study adopted a survey design that is both descriptive and exploratory. Data was collected using questionnaires that were pegged on a Likert Scale. Content validity was determined by the use of a panel of Senior Staff members of four SACCOs, whose suggestions and recommendations were incorporate before distributing the questionnaire. Cronbach alpha was used to assess the reliability of the questionnaire. The data collected was processed and analyzed using statistical packages for social sciences (SPSS) software Version 22. Correlation and multiple linear regression analysis was used to test the relationship. The Liquidity management was found to have a positive and significant effect on financial performance of SACCOs. Coefficient (r) or beta as reflected on Table 4.14 and 4.15 rbo were 0.824 and(0.117 which means that liquidity management affected financial performance associated credit risk by 82.4% and financial performance associated with current asset management by 11.7%. They were significant with p values of 0.000, 0.045 respectively. The study concluded that SACCOs should encourage liquidity management as when the current assets are controlled there is an improvement in financial performance of SACCOs. The research recommended that a replica of this study to be done in other sectors. A similar one can be done on SACCOs but instead of using Likert scale the study to use both open ended and closed ended questionnaires to get more information form the respondents.
Keywords: Liquidity management, financial performance, SACCOs.
Title: Effects of Liquidity Management on the Financial Performance of SACCOs
Author: Lydia Wambui Kimemia, Prof. Gregory Namusonge, Prof Maurice M. Sakwa
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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