Factors Affecting Personal Loans Growth Strategies in Commercial Banks in Nairobi (a Case of Equity Bank Limited in Kenya)
There are concerns that interest rates on personal loans in Kenya are high and the country remains among the most unfriendly countries in the world in terms of cost of lending. Studies undertaken on loans include; "Credit Scoring Practices and the Non-Performing Loans in Kenyan commercial banks", by (Mutie, 2001), "The relationship between Interest rates and Non-performance loans in commercial banks in Kenya" by (Bochaberi, 2007). However, no known study has been undertaken on factors affecting personal loans growth strategies in commercial banks. The purpose of this study was to establish the factors affecting personal loans growth strategies in commercial banks, a case study of Equity Bank Limited. The study adopted a descriptive research design. The target population of the study was the customer care officials of Equity Bank in Nairobi branches which currently stand at 38. We have only one customer care official in each branch and this formed the sample size which was 38 customer care officials. Data was collected using questionnaires. Data was analyzed by use of descriptive statistics and the findings presented inform of figures and tables. In conclusion, interest rates determine the advancement of personal loans; competition plays a vital role as every bank or financial institution tends to work out formalities of outdoing their rival in the business; there is a need of opening more branches closer to the customers and make them more efficient; and technology speeds up transmission of information on products in the market and at the same time, the customers get to know when their loans are ready for dispatch. On recommendation, banks should revise their interest rates on personal loans; banks should study well the competitive market they are treading in; banks should ensure that it has several branches and outlets or satellites to serve its mass of customers; and management of organizations should entrench a well defined policy that identifies the embrace of new technologies and creativity within its networks and operations.