Lending Interest Rate on the Growth of Mortgage Financing in Kenya

Purpose: The current study, sought to investigate the effect of average quarterly lending interest rate on quarterly growth of mortgage financing in Kenya. This study was guided by the loanable funds theory. Design/ methodology/ approach: The study took a quantitative approach drawn from the positivism research philosophy. Therefore, the study was a time series research design which was used to track the growth of mortgage financing in Kenya for the last 20 years – from the year 2002 to 2021. The study targeted the time-series quarterly data from CBK for the last 20 years. Items to be collected included the following: average quarterly lending interest rate and quarterly growth of mortgage financing. The study used secondary data which was extracted from CBK quarterly data reports website for the period 2002 to 2021. The quantitative secondary data was analyzed by use of descriptive and inferential statistics. A 95% confidence interval was the statistical error variance used. Data was coded and analyzed using STATA 14 (or EViews 14.0). Findings: The findings revealed that lending interest rate and growth of mortgage financing in Kenya are negatively and significantly related (β = -0.265, p=0.020). This implies that an increase in lending interest rate results in a decrease in the growth of mortgage financing by 0.419 units and vice versa. Unique contribution to theory, policy and practice: Given the long-run negative effects of lending interest rates on the growth of mortgage financing in Kenya, the study recommends that the Central Bank of Kenya (CBK) should develop and implement policy frameworks aimed at stabilizing and minimizing inflationary pressures, which often trigger increases in interest rates. High lending rates erode the purchasing power of citizens, consequently, discouraging home ownership and slow down the development of the real estate sector. To address this, the CBK should consider adopting accommodative monetary policies that encourage credit expansion for housing development, while simultaneously strengthening financial regulations to safeguard against excessive risk-taking by lenders. &nbsp

The Influence of Investment Regulation on the Financial Performance of Deposit-Taking SACCOs in Kenya: Evidence from Panel Data

Investment regulation plays a critical role in safeguarding the financial stability and performance of deposit-taking Savings and Credit Cooperative Societies (SACCOs), especially in emerging economies. In Kenya, the SACCO Societies Act of 2008 and accompanying prudential guidelines by the SACCO Societies Regulatory Authority (SASRA) require SACCOs to comply with strict investment frameworks. However, despite these regulations, financial performance outcomes across SACCOs remain inconsistent, raising questions about the effectiveness of investment regulation in driving performance. This study investigates the influence of investment regulation on the financial performance of deposit-taking SACCOs in Kenya using panel data covering the period 2018–2023. The study employs a descriptive and explanatory research design using secondary data from 175 SASRA-licensed SACCOs. Panel regression analysis was used to determine the relationship between investment regulatory compliance measured by return on investment (ROI), and financial performance indicators, namely return on assets (ROA). The results reveal that investment regulation has a statistically significant and positive effect on SACCO financial performance, suggesting that compliance with prudent investment standards enhances returns and institutional sustainability. The findings have practical implications for SACCO boards, regulators, and policymakers in optimizing investment policies and strengthening regulatory oversight. The study recommends enhanced enforcement of investment diversification requirements and greater capacity building for SACCO management to interpret and implement investment policies effectively

The Effect of Credit Regulation on Financial Performance of Deposit-Taking Savings and Credit Cooperative Societies in Kenya.

Credit regulation is a critical component of prudential oversight in the cooperative financial sector, aimed at safeguarding assets and ensuring the sustainability of Deposit-Taking Savings and Credit Cooperative Societies (DT-SACCOs). This study investigates the effect of credit regulation on the financial performance of DT-SACCOs in Kenya. Utilizing secondary panel data from 175 SACCOs between 2018 and 2023, the study measured credit regulation through non-performing loans (NPLs) and debt service coverage ratios, while financial performance was assessed using return on assets (ROA). Employing fixed-effects panel regression, the findings reveal a statistically significant positive relationship between effective credit regulation and financial performance. SACCOs with robust credit policies exhibited lower NPL levels and higher profitability. The study concludes that strengthening credit appraisal frameworks and enforcing regulatory compliance enhances SACCO resilience and financial viability. It recommends continuous staff training, updated credit policies, and real-time credit risk monitoring to sustain financial performance in the SACCO sector

GDP Growth Rate on the Growth of Mortgage Financing in Kenya

Purpose: The current study, sought to establish the effect of GDP growth rate on the growth of mortgage financing in Kenya. The study was grounded on the Classical Growth Theory. Design/ methodology/ approach: The study took a quantitative approach drawn from the positivism research philosophy. Therefore, the study was a time series research design which was used to track the growth of mortgage financing in Kenya for the last 20 years – from the year 2002 to 2021. The study targeted the time-series quarterly data from CBK for the last 20 years. Items to be collected included the following: average quarterly GDP growth rate and quarterly growth of mortgage financing. The study used secondary data which was extracted from CBK quarterly data reports website for the period 2002 to 2021. The quantitative secondary data was analyzed by use of descriptive and inferential statistics. A 95% confidence interval was the statistical error variance used. Data was coded and analyzed using STATA 14 (or EViews 14.0). Findings: The findings revealed that GDP growth rate and growth of mortgage financing in Kenya are positively and significantly related (β = 0.380, p=0.001). This implies that an increase in GDP growth rate results in an improvement in the growth of mortgage financing by 0.255 units and vice versa. Unique contribution to theory, policy and practice: CBK should implement the appropriate monetary policy instruments to ensure improvement in the GDP growth rate. This is because its relationship to the growth of mortgage financing in Kenya has been found to be positive and significant. Thus, the growth of GDP ought to be closely monitored for effective generation of wealth for the financing of mortgages in Kenya

Contextualizing Strategic Management Theory for African Enterprises: Institutional Realities, Resource Constraints, and Local Adaptation

This paper advances a locally grounded approach to understanding strategic management practices in African firms. The forces of globalization and the internationalization of markets have significantly reshaped the economic landscape of African countries, positioning the private sector as a central driver of wealth creation. Within this context, business restructuring and privatization initiatives have emerged as key components of economic transformation. Concurrently, the adoption of new management practices, strategic concepts, and analytical tools has become increasingly influential in shaping firm performance. These developments raise a critical question regarding the applicability of classical management theories and strategic frameworks largely developed in Western contexts to African business environments. Drawing on four case studies, the study examines the relevance of three dominant strategic perspectives: the institutional perspective, transaction cost economics, and the resource-based view. The findings indicate that while these perspectives offer valuable analytical insights, their explanatory and practical power is limited when applied without contextual adaptation. The paper concludes that integrating a local perspective accounting for institutional realities, socio-cultural dynamics, and structural constraints is essential for enhancing the strategic effectiveness and competitiveness of African firms

Constraints to Green Supply Chain Management in South Africa’s FMCG Sector: A Case Study Approach.

Organizations across various sectors including those in the Fast-Moving Consumer Goods (FMCG) industry are increasingly recognizing the importance of adopting green supply chain management (GSCM) practices in their operations. This article aims to explore the specific constraints encountered by an FMCG factory located in Durban in implementing GSCM practices, and to examine the strategies the factory employs to mitigate these challenges. The study adopts an exploratory research design, utilizing primary data collected through eight semi-structured interviews conducted with key personnel at the factory. A purposive sampling approach guided the selection of participants. The findings reveal that GSCM constraints fall into four main categories: green procurement, green manufacturing, green transportation, and product recovery. In response to these challenges, the factory has implemented measures such as aligning its green supply chain goals with broader business objectives and prioritizing waste reduction initiatives. Recommendations from the study include strengthening supplier relationships and fostering a workplace culture that encourages employee engagement with environmental sustainability efforts. Given the limited research on GSCM barriers within the South African FMCG sector, this study contributes to the academic discourse by highlighting actionable areas for improvement and offering practical insights for industry stakeholders

The Role of Behavioral Competencies in Enhancing Supply Chain Resilience and Firm Performance: The Moderating Influence of Internal Integration.

This study examines the mediating role of supply chain resilience in the relationship between behavioral competencies and firm performance, as well as the moderating effect of internal integration on the link between supply chain resilience and firm performance. An explanatory research design was employed, utilizing a purely quantitative approach. Data were collected from 227 healthcare delivery firms in the Ashanti Region of Ghana using convenience and purposive sampling techniques. Structural equation modelling (SEM) was used for data analysis. The results reveal that behavioural competencies have a positive and significant impact on supply chain resilience, which, in turn, positively and significantly influences firm performance. Moreover, supply chain resilience significantly mediates the relationship between behavioural competencies and firm performance. Additionally, internal integration was found to positively and significantly moderate the relationship between supply chain resilience and firm performance. This study offers valuable insights into how behavioural competencies contribute to supply chain resilience and, ultimately, to firm performance. It also highlights the critical role of internal integration in strengthening the impact of supply chain resilience. The findings contribute to both theoretical understanding and managerial practice within the context of healthcare supply chains

Determinants Of Credit Accessibility in the Informal Sector: The Case of Smallholder Businesses in Migori County, Kenya

The informal sector, estimated to constitute 98% of businesses in Kenya, represents 83% of total employment and created 768,000 new jobs which represent 90.7% of total new jobs created in 2019 alone. Despite the critical role played by the sector in job creation and employment, it is faced with numerous challenges and constraints one of them being access to credit. Access to credit does not only have adverse effects on the informal smallholder businesses alone but on the entire economy. The study seeks to analyze the determinants of Socio-Economic and the Institutional factors on credit accessibility in the informal sector for the smallholder businesses in Migori County. The study employed descriptive survey research design. Targeting 4,756 traders in total, a three-stage stratified random sampling method was employed to select the smallholder traders in the study area represented by a sample size of 476 businesspersons. Structured questionnaires and interview schedules were developed, pre-tested and used for collecting quantitative data for the study. Piloting of the study was carried out to ascertain the validity and reliability of the data collection instrument. The targeted sample smallholder businesspersons successfully interviewed were 446 in total, representing a response rate of 93.70%. Descriptive statistics and the logistic regression model were used in analyzing quantitative data. The output from the study model indicates that 245(54.9%) of the sampled businesspersons were credit users whereas the remaining 201(45.1%) were non-credit users. Experience in credit use, one of the socio-economic factors expected to influence credit accessibility was statistically significant and positively related to credit access at 1% probability (.335, p = .001), in line with the prior research expectations. Even though positively related and consistent with the a priori expectation, the contribution of the propensity to take risks (attitude towards risk) by the smallholder businesspersons was insignificant (.515, p = .743) at 5%. However, all the institutional factors were found to be statistically insignificant and negatively related to credit accessibility. Even though consistent with the a priori expectation, the contribution of distance from credit source in the prediction of the model was insignificant at 5% (-.034, p = 0.215). Membership by the smallholder businesspersons to multi-purpose cooperatives and or business associations was negatively and insignificantly related to credit access by the same group in the study area, contradicting the a priori expectation (-.274, p =.529). The outcome of the study would be useful to policy makers, Micro-Financial Institutions, academicians and future researchers in identifying innovative options and institutional arrangements that would serve as an input for formulating credit policy and advancing arguments in future research. The study concludes that a large number of the informal sector smallholder businesspersons have never accessed credit which implies a very huge potential demand for credit

Digital business model design and transient competitive advantage among manufacturing firms in Kenya.

The manufacturing sector plays a critical role in Kenya’s economic development, yet its contribution to national output remains modest, partly due to limited competitiveness in an increasingly digitalized business environment. This study examines the influence of digital business model design strategies on the attainment of transient competitive advantage among large-scale manufacturing firms in Kenya. Anchored on strategic management and digital transformation perspectives, the study adopts a correlational research design to assess the relationship between digital strategy dimensions and competitive outcomes. The target population comprised 857 large-scale manufacturing firms, from which a sample of 348 firms was drawn, achieving a response rate of 76.8%. Data were analysed using Pearson correlation and bivariate regression techniques. The findings indicate a strong and statistically significant positive relationship between digital business model design strategies and transient competitive advantage, demonstrating that firms with well-integrated digital strategies are better positioned to respond to rapidly changing market conditions. Regression results further confirm that digital business model design is a significant predictor of transient competitive advantage. The study concludes that deliberate investment in digital transformation, innovative revenue models, and integrated customer engagement platforms is essential for sustaining competitiveness. It recommends the development of supportive policy frameworks and firm-level strategic alignment to enhance the effective implementation of digital business model strategies within Kenya’s manufacturing sector

Strategic Congruence on The Performance of Non-Profit Organizations in Kenya: A Case of Compassion International Child Development Centres in Nyanza Region

Purpose: The main objective of the study was to investigate the effect of strategic congruence on the performance of non-profit organizations in Kenya: a case of Compassion International Child Development Centres in Nyanza Region. Methodology: The study used a descriptive research design and focused on three clusters in Nyanza region with 47 Child Development Centres (Migori 13, Kisumu-Siaya 18 and Homabay 16) with a target population of 149 staff. The staff were the unit of observation, while the CDCs was the unit of analysis. The population was sampled using stratified random sampling to achieve 109 CDC staff, with an additional 10% incorporated to address non-response, resulting in a new sample size of 121. Data was collected using questionnaires, and pre-testing of the questionnaire was conducted on 10% of the total main sample, targeting 12 CDC staff, to ensure validity and reliability. Validity was determined using the Kaiser-Meyer-Olkin test, while reliability was tested using the Cronbach Alpha coefficient with a threshold of 0.7. The study analyzed data using descriptive and inferential statistics. Key statistical measures included beta values, p-values, R², and t-values, with a significance level of p<0.05. The overall results were presented using database tables, visualizations, patterns, and charts. Results: The findings show that environment congruence has the strongest positive impact on organizational performance, with an unstandardized coefficient of 0.634 and a standardized Beta of 0.426 (p < 0.001). Strategic leadership follows with an unstandardized coefficient of 0.352 and a Beta of 0.347 (p < 0.001). Cultural congruence, while still significant (p < 0.001), has a weaker effect with a coefficient of 0.168 and a Beta of 0.253. Structural congruence also positively affects performance, with a coefficient of 0.211 and a Beta of 0.209 (p = 0.005). The regression model confirms that environment congruence and strategic leadership are key predictors of performance. Unique contribution to theory, policy and practice: The study contributes significantly to both theoretical frameworks and practical knowledge within the field of strategic management, particularly concerning non-profit organizations (NPOs) in Kenya. By examining the effect of strategic congruence on the performance of Compassion International Child Development Centres (CICDC) in the Nyanza region, this research provides insights that enhance understanding of how alignment between organizational strategies and external environments can influence effectiveness and impact. The study's theoretical contribution lies in its extension and validation of established frameworks within strategic management, particularly in the context of non-profit organizations (NPOs). By anchoring the research on Dynamic Capability Theory, Resource-Based View Theory, and Organizational Theory, the study elucidates how strategic congruence—defined as the alignment of an organization’s goals, activities, and resources with its mission and external environment—affects performance outcomes