PRODUCT INNOVATIONS AND FINANCIAL PERFORMANCE OF DEPOSIT TAKING SAVINGS AND CREDIT CO-OPERATIVES SOCIETIES IN NAIROBI CITY COUNTY, KENYA

Annet Temko Ndiema, Dr. Joshua Bosire, Dr. Kimani E. Maina, Dr. Charles Roche

Abstract


The concept of Saccos’ financial performance is employed to assess a company's overall financial well-being within a specific timeframe and can also be utilized to make comparisons between similar companies within the same industry or to evaluate entire industries or sectors as a whole. The main objective of this study sought to investigate the effect of product innovations on financial performance of DT Saccos in Nairobi City County, Kenya. All the 46 registered DT Saccos in Nairobi City County by SASRA made up the target population hence a census study conducted to study the entire population. Secondary data was sourced from audited financial records of all the registered DT Saccos. The data was analyzed using descriptive and inferential statistical methods with the aid of SPSS, (Version 29.0) statistical software. The research correlation analysis findings depicted a strong positive correlation between product innovations and financial performance. Panel regression model was applied for data analysis and Langrage multiplier test done that determined that random effect model was suitable for analysis. The study findings of the panel regression model indicated a positive and significant effect between product innovation and financial performance of DT Saccos in Nairobi County (coefficient values of 0.844 with P values of 0.001). The R2 value of 0.618 implies that 61.8% of the variations in the perceived financial performance can be explained by the product innovations while factors not studied in this research contribute 38.2% of variance in the dependent variable. The study recommended that DT Saccos should embrace working closely with fintech companies so as to leverage on great and innovative products and services offered by these companies with the goal of improving operational efficiency, increasing profitability, and expanding their market presence, taking into account their unique organizational characteristics as an additional advantage.

Keywords: Product Innovations, Financial Performance, DT Saccos


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