Title:
INFLUENCE OF GOVERNMENT POLICIES ON THE FINANCIAL PERFORMANCE OF SACCOS IN IMENTI NORTH SUB-COUNTY, KENYA

Authors:
Phineas Muriungi Muguna,Fredrick Mutea and Dr. Ken Mugambi ,Kenya

Abstract:
The main goal of starting SACCO’s is to mobilize funds in order to advance credit to clients. Funds are mainly mobilized from savings by customers who mainly provide a stable source of low cost funding. Cooperatives are one of the pillars supporting Kenya’s economic growth since independence. It is reported that mismanagement, ethnicity and corruption are the most significant factors affecting the performance of SACCOs, various studies have been carried and the researches dwelt on the power of financial ratios in detecting fraudulent financial reporting in SACCOs. This study focuses on analyzing the factors affecting the financial performance of SACCOs in Imenti North Sub-County. SACCOs are expected to empower their members through mobilization of savings and provision of credit to their members. The study objective was to establish the influence of government policies on the financial performance of SACCOs in Imenti North Sub-County. The study adopted a descriptive survey research design and the target population of the study was 108 management staff from all the 34 registered Sacco’s in Imenti North Sub- County and which were registered with the district cooperative office by January 2019 to conduct business as Sacco’s. These management employees in the Sacco’s included Sacco managers, credit managers and credit officers. The results showed that there is positive influence of government policies on financial performance in SACCO’s. This shows that government policies have a positive influence on financial performance in Sacco’s. The study concluded that there are many conflicting policies from the ministry of cooperatives and Sasra which affects financial performance of Sacco’s and that Sacco’s are operating in financial distress which is affecting their financial performance. The study recommended that Sacco’s should develop internal policies that does not conflict SASRA policies