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Item Understanding Performance of Small and Medium-Sized Enterprises in Nairobi City County, Kenya: The Influence of Financial Accessibility Practices(Journal of Business Management & Innovation, 2026-03) Alata, Vincent; Aluoch, Moses OdhiamboIn any business or organization’s endeavors, performance is the critical vision for management, growth, and improvement. Besides, in the unpredictable and competitive business environment, the availability of financial resources plays a significant role a sound financial accessibility practice leads to better business opportunities and innovative processes. Small and Medium Enterprises are part of the vast informal economy, which significantly contributes to job creation and poverty alleviation. In Kenya, however, within a few months of operation, about half of these businesses close, while most that remain perform poorly. The dismal performance has been linked to challenges in credit access in the banking sector, as these financial institutions play a key role in serving this segment. The study examined the influence of financial accessibility practices on the performance of small and medium-sized enterprises in Nairobi County, Kenya. Specifically, the study aimed to investigate the impact of entrepreneurial orientation, interest rate, collateral requirements, and credit rationing on access to credit and performance of Small and Medium Enterprises. This research was anchored in three theories: the asymmetric information theory, the adverse selection theory, and the Credit Rationing Theory. A descriptive survey research design was employed in the study to target 3,000 Small and medium enterprises registered in Nairobi County. The sample size was determined using Taro Yamane's formula, selecting 97 respondents as the unit of observation. Proportionate stratified and random sampling was used as the sampling technique. The data collection instrument was a pilot-tested questionnaire for accurate measurement examination. Descriptive statistical methods, such as the mean, standard deviation, frequencies, and percentages, were used to analyze the data. In addition, inferential statistical techniques, such as Pearson's correlation and multiple regression, were used to assess relationships among the variables. The data were presented through tables and charts. The empirical results indicate that the four independent variables had a significant impact on the performance of Small and Medium Enterprises in Nairobi County, Kenya (Adj R2 = 0.743, F-stat = 54.485, p < 0.005). The study concluded that financial accessibility practices improve the affordability, profitability, growth, and cost efficiency of firms' financial services. The study's findings contribute to the body of knowledge, thereby enriching the formulation of policies and best practices for firms to access credit and loans. Management and directors of Small and Medium Enterprises should entrench credit access activities and practices to optimize organizational outcomes.Item Financial Management Practices and Financial Performance of Commercial and Manufacturing State Corporations in Kenya(IPRJB, 2026-03-24) Njoroge, Peter; Jagongo, AmbrosePurpose: This independent study in finance attempts to investigate effect of Financial Management Practices on Financial Performance of Commercial and Manufacturing State Corporations in Kenya. Methodology: Researcher intends to adopt a positivist philosophy that demands researcher to be independent of the study. Explanatory non-experimental research design will be employed in the study. For the purposes of this study, a census of all Commercial and Manufacturing Corporations will be used in study. The study will use Secondary data from financial statements of Commercial and Manufacturing State Corporations for period 2020- 2025. Data will be obtained from office of auditor general and Kenya Parliament Library. Researcher proposes to use a panel multiple linear regression model in the analysis and Baron & Kenny (1986) methodology to test for mediation and moderation effects. Findings: The study anticipates that effective financial management practices will significantly enhance Financial performance with internal cashflows mediating this effect, particularly moderated by firm size in Commercial and Manufacturing State Corporations in Kenya. The study will determine whether the financial management practices significantly affect Financial Performance of Commercial and Manufacturing State Corporations In Kenya and give advise to Management and those charged with governance of these corporations on management practices of serious concerns for improvement. Findings will guide management to prioritize risk management practices, advising governance bodies on reforms to improve financial health and reduce bailout dependencies. Unique Contribution to Theory, Practice and Policy: Management of Commercial and Manufacturing State Corporations will be able to tell how financial management practices affect their financial performance. The study intends to ennriches literature by testing mediation and moderation in an African SOEs context, potentially refining Resource based Theory for resourceconstrained environments. The study informs turnaround strategies for Kenyan SOEs, such as optimizing capital structure to boost performance amid economic volatility. Finally, the study will provide evidence for policymakers (e.g., Treasury) to enforce better financial practices, supporting sustainable development goals.Item Strategic Human Resource Outsourcing Motivators and their Effect on Outsourced Employee Retention among Oil and Gas Companies in Kenya(StratfordPeerReviewedJournalsandBookPublishing, 2026-03) Amisi, Faith; Keino, Dinah; Omagwa, JobEmployee retention among outsourced workers remains a significant organizational challenge, owing to the fact that these employees frequently perform comparable roles to permanent employees while receiving unequal benefits. Such disparities erode perceptions of fairness, job security, and organizational belonging, lowering motivation and increasing turnover intentions, particularly in skill-intensive industries such as oil and gas. In response, this study looked at how strategic motivators affect employee retention in Kenyan oil and gas companies. The study used Resource Dependency Theory and a pragmatist philosophy to guide the research, which used a mixed-methods approach. The study targeted 219 oiland gas firms and drew a sample of 125, collecting responses from 211 Heads of Human Resources and Procurement, resulting in an 84.4% response rate. Semi-structured questionnaires were used to collect quantitative and qualitative data, and their validityand reliability were confirmed via expert review and Cronbach's Alpha. Descriptive statistics, correlation, and multiple regression analyses were used to test hypotheses and determine statistical significance. The independent variables accounted for 52.9%of the increase in employee retention. Strategic human resource motivators had a positive and statistically significant effect on retention (β = 0.207; p = 0.011). Based on these findings, the study recommends that the Ministry of Labor and Social Protection create sector-specific outsourcing frameworks that mandate annual vendor compliance reporting on outsourced employee retention indicators. Policy frameworks should address disparities between permanent and outsourced employees by mandating inclusion in training, career development, remuneration reviews, and welfare initiatives in the oil and gas industry. Firms are also encouraged to improve HR governance by using standardized contracts, risk management systems, and strategic alignment of outsourcing decisions to increase outsourced employee retention. Lastly, organizations should assess which HR functions generate the most value when outsourced to improve employee support and satisfaction.Item Technology-Driven Financial Services and the Profitability of Five-Star Hotels in Nairobi City County, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-10) Huria, Ann Wambui; Irungu,Anthony Mugethahe hotel industry is a critical component of Kenya’s economy, with Nairobi City County hosting the highest concentration of five-star hotels. Between 2020 and 2024, these hotels experienced a marked decline in profitability. This study examined the effect of technology-driven financial services on the profitability of five-star hotels in Nairobi. Specifically, it investigated the impact of online booking platforms, mobile banking solutions, fintech-based loyalty programs, and automated invoicing systems. Anchored on Transaction Cost Theory, Innovation Diffusion Theory, and the Technology Acceptance Model, the study employed a descriptive research design targeting Finance, IT, and Customer Service departments across all eleven five-star hotels in Nairobi, yielding 62 respondents. Data were collected via structured questionnaires and analyzed using multiple regression techniques. Findings revealed that online booking platforms (β = 0.843, p < 0.05), mobile banking solutions (β = 1.333, p < 0.05), and fintech-based loyalty programs (β = 0.802, p < 0.05) significantly and positively influenced profitability, with mobile banking showing the strongest effect. Automated invoicing systems had a positive but statistically insignificant effect (β = 0.136, p = 0.382). The study concluded that integrating digital financial technologies, particularly mobile banking, online booking platforms, and loyalty programs, enhances hotel profitability. Recommendations include improving booking platforms, prioritizing mobile banking investments, and developing personalized loyalty programs integrated with other fintech tools to boost customer retention and long-term financial performance.Item Digital Financial Services and Profitability of Microfinance Banks in Kenya: A Theoretical Review(Globeedu Group, 2026-02) Omwenga, Kerubo Cyprine; Jagongo, AmbroseMicrofinance banks play a crucial role in promoting financial inclusion in Kenya by serving low-income households and informal sector businesses. The profitability of microfinance banks in Kenya has fluctuated over the past few years, raising concerns about the sector’s financial sustainability. Return on assets increased slightly from 1.2% in 2021 to 1.4% in 2022, and further rose to 3.7% in 2023, indicating a gradual recovery in profitability. In 2024, the sector recorded a significant decline in return on assets, reporting a negative return of 6.1%, reflecting losses. The general objective of the study is to investigate the effect of digital financial services on the profitability of microfinance banks in Kenya. The specific objectives of this study are to determine the effect of mobile banking, internet banking, and agency banking services on the profitability of Kenyan microfinance banks. The research study also aims to establish the moderating effect of the regulatory framework on the relationship between digital financial services and the profitability of Kenyan microfinance banks. The study was anchored on the technology acceptance theory and supported by financial intermediation theory, financial innovation theory, and institutional theory. An empirical literature study was also incorporated.Item Moderating Effect of Environmental Regulatory Framework on the Relationship Between Green Investment Initiatives and Profitability of Manufacturing Firms in Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2026-03) Karanja, Teresiah Wairimu; Warui,Fredrick Waweru; Aluoch, Moses OdhiamboDespite their importance, manufacturing companies continue to encounter ongoing profitability challenges. Over the past decade, listed manufacturing firms in Kenya have experienced a consistent decline in return on assets (ROA), which reflects diminishing efficiency in asset utilization. This study aimed to assess how green investment practices influence the profitability of manufacturing companies in Kenya, while also examining the moderating influence of environmental regulations on this relationship. The research was underpinned by five theoretical perspectives: the Porter Hypothesis, Sustainable Finance Theory, Transaction Cost Economics Theory, Dynamic Capability Theory, and Institutional Theory. The study focused on ten manufacturing companies registered and publicly traded on the Nairobi Securities Exchange (NSE). Findings from correlation and regression analyses indicated that all four categories of green investment were positively and significantly associated with profitability. Among these, energy efficiency investments demonstrated the most substantial positive impact (r = 0.641, B = 0.821, p = 0.000), followed by investments in green supply chain management (r = 0.241, B = 0.447, p = 0.013) and renewable energy initiatives (r = 0.182, B = 0.314, p = 0.039). Sustainable waste management practices also showed a positive relationship with profitability, though the contribution was relatively modest (r = 0.094, B = 0.192, p = 0.233). Collectively, the green investment variables accounted for 38.6% of the variance in firm profitability (R² = 0.386), indicating considerable explanatory power. When the environmental regulatory framework was incorporated as a moderating variable, the explanatory strength of the model increased to 45.7% (R² change = 0.071, F change = 4.189, p = 0.006). This suggests that regulatory support amplifies the financial benefits derived from green investments. The study concludes that green investment initiatives significantly contribute to enhanced profitability in manufacturing firms, with regulatory policies providing a supportive, albeit limited, moderating effect. It recommends that policymakers reinforce environmental regulations and introduce incentives that encourage sustainable industrial investment. Manufacturing companies are also encouraged to embed green practices into their core operations as a strategy to boost competitiveness and profitabilityItem Moderating Effect of Capital Inflows on the Relationship Between Systematic Risks and Stock Market Return Volatility Among Firms Listed at the Nairobi Securities Exchange, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2026-02) Kinuthia,David Ngugi; Warui, Fredrick; mithi, FestusThe study assessed the moderating effects of capital inflows on the relationship between systematic risks and stock market return volatility among firms listed at the NSE, Kenya. Volatility in the stock market in Kenya has been on the rise in the recent years. Capital inflows can impact stock market volatility by affecting overall market liquidity and investor sentiment. Sudden changes in capital flows, such as large-scale foreign selling or buying, can exacerbate market volatility as prices adjust to accommodate the influx or outflow of funds. Empirical studies found conflicting findings and displayed research gaps that this study sought to fill. The study was anchored on positivism philosophy and correlational research design. The target population was all 62 NSE listed firms listed between 2014 and 2024. Secondary data was collected from NSE, KNBS, CMA and world bank reports using data collection sheet. The data was analyzed through descriptive statistics and multiple regression. The study found that individual interaction terms were insignificant, including inflation (β = -0.0172, p = 0.428), exchange rate (β = 0.0368, p = 0.306), and interest rate (β = -0.0215, p = 0.389). Hence, capital inflows had no significant moderating effect on the relationship between systematic risks and stock market return volatility. The study concludes that capital inflows have no significant moderating effect on the relationship between systematic risks and stock market return volatility of firms listed at the NSE Kenya. The study recommends that regulatory bodies such as the CMA and CBK develop policies that encourage productive and long-term capital inflows. The CMA and CBK should establish early warning mechanisms that monitor capital flow volatility and its potential spillover effects on equity market stability. Market regulators should also enhance investor education initiatives so that market participants are better equipped to respond rationally to changes in capital flow patterns, thereby reducing sentimentdriven volatility in the Kenyan stock marketItem Does Size Shield? Examining the Moderating Role of Firm Size on Market Risk–Profitability Nexus among Kenyan Insurers(INTERNATIONAL JOURNALS OF ACADEMICS & RESEARCH, 2025) Gitau, Kimacia; Wamugo, Lucy; Omagwa, JobThe insurance industry constitutes a critical pillar of the non-bank financial sector and remains integral to sustaining economic development in both emerging and advanced markets. In Kenya, persistent pressures on profitability have been evident, with at least nine insurers experiencing severe financial distress leading to collapse over the past ten years. This study examined whether firm size moderates the relationship between liquidity risk and credit risk in shaping the profitability of insurance companies in Kenya. The inquiry was anchored on key theoretical frameworks, namely Modern Portfolio Theory, Agency Theory and Institutional Theory. A positivist philosophical orientation and an explanatory research design informed the methodological choices. The target population comprised all 55 insurers licensed by the Insurance Regulatory Authority (IRA) as at 31 December 2022. The study utilized secondary data derived from audited financial statements accessed through IRA and the Association of Kenya Insurers (AKI) repositories for the period 2014–2022, complemented by data from the Central Bank of Kenya and the Kenya National Bureau of Statistics. Analytical procedures included descriptive statistics, panel regression modelling, and Pearson’s correlation analysis to evaluate the associations among the study variables. The findings revealed that firm size did not exert a statistically significant moderating effect, as it did not materially alter the model’s decision rule. This suggests that the influence of interest rate, inflation and foreign exchange risks on return on equity (ROE) and return on assets (ROA) remained relatively uniform across insurers irrespective of their asset base. The study recommends that insurance companies in Kenya should implement comprehensive and standardized risk management practices irrespective of organisational size.Item Bank Characteristics, Central Bank Rate and Profitability of Tier Three Commercial Banks in Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-09) Kariuki, Fredrick Njuguna; Aluoch, Moses OdhiamboKenya's tier three commercial banks have experienced declining profitability, with the Central Bank of Kenya reporting slowed profit growth in 2023 due to rising operational costs and increasing non-performing loans that constrain profit margins. Thus, this study examined the effects of market share, asset quality, and capital adequacy on the profitability of Kenyan tier three commercial banks, with central bank rates as a moderating variable. The research employed a descriptive design using secondary data from audited financial reports spanning 2015-2024, applying panel data methodology with multiple regression and diagnostic tests to analyze relationships between variables and profitability. Findings showed that profitability in Kenya's tier three banks was positively shaped by market share, asset quality, and capital adequacy. Stronger market positions boosted earnings, sound assets reduced default rates, and robust capital improved financial stability. While market share and asset quality also reinforced one another, capital adequacy appeared less connected to loan quality, suggesting different underlying drivers. The central bank rate had a weaker and less consistent influence, though modest increases could enhance profitability through interest margins; however, its overall direct effect in the panel model was negative, indicating that higher rates generally dampen returns. When monetary policy context was considered, the explanatory power of the model improved, with larger banks and well-capitalized institutions showing greater ability to withstand tighter policy conditions. Asset quality's interaction with monetary policy was not significant, but it still trended positively, hinting at potential benefits under certain conditions. The study concludes that profitability in Kenya's tier three banks is shaped by the combination of internal elements—capital strength, asset quality, and market share—and external forces like central bank rates. The study recommends that banks should prioritize market share expansion through strategic diversification and digital transformation while strengthening asset quality management through robust credit appraisal systems and comprehensive risk frameworks. The study recommends that tier three banks should develop comprehensive capital management strategies beyond regulatory compliance and establish sophisticated monitoring systems for macroeconomic indicators, particularly Central Bank Rate movements. The study recommends that banks should strengthen governance structures through independent board composition, empowered risk committees, and transparent leadership practices to ensure regulatory compliance and build stakeholder confidence.Item Digital Credit and Financial Performance of Small and Medium Enterprises in Nairobi City County, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-09) Thomas, Jane Nzembi; Mwenda, NathanThis study ascertained the effect of digital credit on financial performance of selected SMEs in the CBD of Nairobi City County, Kenya. The research employed a cross-sectional research design. The population comprised 5,400 SMEs located in the Nairobi CBD. The study utilized a stratified random sampling technique to determine the necessary sample size. The sample involved responders selected by stratified proportionate sampling to identify 358 significant SMEs across several categories by the Licensing Office in Nairobi City County Offices. The research utilized source data gathered via a research tool. A pre-testing questionnaire was administered to 18 owners/managers of SMEs not included in the study sample. All the others in SMEs in Nairobi, not included in the study population, made up this population. Cronbach’s alpha tested the reliability of the scale and a score of 0.7 was considered. SPSS Package for Social Sciences was used. All the data gathered was of the quantitative type and it was analyzed through inferential analysis and descriptive analysis. It was shown as figures and tables. It was found that digital credit, its easy access, the rules surrounding it and its terms are key to how SMEs in Nairobi City County, Kenya, manage their finances. The research showed that SMEs in Kenya benefit financially from being able to access digital credit. Digital credit does not have a major impact on SME finances. It is concluded that the rules for digital credit play, a vital role in the financial health of SMEs. SMEs depend on privacy regulation, identity theft regulation and interest rate regulation that deal with the issues and appropriate responses. From this study, it is advised that SMEs take advantage of digital credit to help them reach their main aims and carefully plan how to achieve their objectives. Those who provide digital credit should make products available to SMEs to assist in shaping their offerings, sell them and urge use of the products by other players in the market. It is necessary to make sure the quality of the credit service is perfect, as this can keep customers from comparing prices with others. The report advises that digital credit providers for SMEs in Nairobi should come up with strategies to increase their online visibilityItem Cash Management Practices and Financial Sustainability of Public Secondary Schools in Nakuru County, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-10) Njoroge, Mercy Wairimu; Makori, DanielOver Ksh 400 billion were given to the education sector in the 2017–2018 fiscal year, but an audit report released in 2018 found that almost a quarter of this money cannot be adequately accounted for. Another study by the Auditor General found that the government had spent 210.34 billion by the 2018/2019 fiscal year. Falsified enrollment numbers may be costing the government millions of shillings in capitation fees for public schools, according to financial data from the Ministry of Education. Thus, the study aimed to explore how various cash management techniques influence the ability of public secondary schools in Nakuru Town Sub-County to maintain a positive cash flow. The study was grounded in the Pecking Order Theory, Transaction Cost Theory, and a Monetary Theoretic Approach to cash management. An explanatory research design was employed for the investigation. The study focused on 33 public secondary schools in Nakuru Town Sub-County, with the analysis units being the principals, school bursars, and Board of Management (BOM) chairs. Given the relatively small target population, a census technique was used to include all the targeted respondents, resulting in a sample size of 99 individuals from the 33 schools. A questionnaire was used as the primary data collection method, and the Cronbach’s Alpha coefficient was applied to assess internal consistency. The data were analyzed using SPSS version 24, producing both descriptive and inferential statistics, with results presented in tables. The study adhered to ethical guidelines, ensuring voluntary participation and respecting participants' privacy. The findings indicated that cash budgeting, cash policies, cash disbursement, and cash flow forecasting all significantly impacted the long-term financial viability of the public schools in Nakuru East Sub-County, Nakuru County, Kenya. The study concludes that cash management practices play a crucial role in ensuring the financial sustainability of public secondary schools in the region. Based on these conclusions, the study recommends that school management teams, including principals and their deputies, should adopt a participatory approach to budgeting by involving all relevant stakeholders throughout the process. Additionally, schools should implement more aggressive credit policies to improve their working capital and achieve financial sustainability. School management should also embrace prudence in managing surplus funds, ensuring their maximum utilization through investments in viable projects. Finally, the Ministry of Education should organize regular training sessions for secondary school principals on cash flow forecasting, especially concerning operating, financing, and investing activities, to enhance their financial decision-making capabilitiesItem Risk Attitude, Socio-Demographic Factors, and Betting and Gambling Behavior among Employed Youths in the Banking Sector in Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-10) Momanyi, Enosh; Njoka,CharityBetting and Gambling have increasingly become prevalent among employed youths in Kenya, particularly within the banking sector, raising concerns about financial stability and responsible behavior among professionals. Despite gambling often perceived as a leisure activity, emerging patterns show that some individuals resort to taking personal loans, liquidating assets, or selling property to sustain gambling habits, resulting in financial distress. Youth aged between 18–35 years make up approximately 35% of the population and form a significant proportion of the workforce, particularly in urban sectors such as banking and finance. This study investigated the influence of risk attitude and socio-demographic factors specifically gender, educational level, and economic status on gambling behavior among employed youths in Kenya’s banking sector. Grounded in Prospect Theory and Expected Utility Theory, the study examined how individual risk preferences and socio-demographic attributes shape gambling decisions among financially literate populations. An exploratory research design was adopted, targeting bank employees aged 18–35 years. Primary data were collected through structured questionnaires and analyzed utilizing both descriptive and inferential statistics, including regression analysis. The results indicated that risk attitude had a statistically significant effect on gambling behavior, leading to the rejection of the first hypothesis. Educational level also significantly influenced gambling behavior, resulting in the rejection of the second hypothesis. Gender, however, was statistically insignificant, and the third hypothesis was not rejected. Economic status was found to have a significant effect on gambling behavior, leading to the rejection of the fourth hypothesis. The study concludes that risk attitudes, educational level, and economic status serve a critical role in shaping gambling behavior among employed youths in the banking sector, while gender does not significantly influence such behavior. In view of the findings, the study recommends that young professionals should understand and manage their risk attitudes to strengthen risk management strategies, leverage educational opportunities for informed decision-making, and address economic pressures that influence gambling tendenciesItem Financial Risk Management Literacy and Its Effect on Financial Sustainability: Insights from Micro, Small and Medium Enterprises in Kakamega County(Stratford Peer Reviewed Journals and Book Publishing, 2025-10) Shitambasi, Hesborn Kisambo; Makori, DanielThe objective of the study was to investigate how financial risk management literacy affects financial sustainability of MSMEs in Kakamega County. The study was anchored on prospect theory. Descriptive survey research design was adopted in the study in which the population comprised of 645 managers and proprietors of MSMEs in the county drawn from trading, manufacturing, distribution and service sectors in the county. The study sample comprised of 247 proprietors selected using stratified sampling technique. Primary data collected using structured questionnaires was utilised in the study. Collected data was analysed using SPSS version 26. Both descriptive statistics and inferential analysis were used in data analysis. Descriptive statistics included mean score and standard deviation. Inferential analysis included Pearson's correlation coefficient and multiple regression analysis. The coefficient of determination (R²), F-statistic, beta coefficient and p-values were used in interpreting results. Results showed that MSMEs demonstrated only modest levels of financial risk management literacy and MSMEs achieved financial sustainability only to a limited extent, as many struggled with profitability, cash flow adequacy, and revenue growth. Correlation analysis results showed that financial risk management literacy showed a strong and positive correlation with financial sustainability. Regression analysis confirmed that financial risk management literacy had a positive and statistically significant effect on financial sustainability. It was thus concluded that financial risk management literacy had a positive and statistically significant effect on financial sustainability of MSMEs in Kakamega County.Item Effect of Savings Generated After Repayment of Women Enterprise Fund Loan On Profitability of the Women-Owned Enterprises in Kajiado County, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-10) Mphande, Celestine Chitumbiko; Jagongo, Ambrose; Muchira,BancyWomen-owned enterprises in Kajiado County demonstrate lower profitability compared to neighboring counties despite comparable growth rates in enterprise numbers. This study investigated the effect of savings generated after repayment of Women Enterprise Fund loans on the profitability of women-owned enterprises in Kajiado County, Kenya. Anchored on the Free Cash Flow Theory, the study employed a positivism philosophy and explanatory research design, targeting 8,100 women entrepreneurs who accessed the Women Enterprise Fund between 2018 and 2022. Using Yamane's formula, a sample of 381 respondents was selected through stratified random sampling across five sub-counties, achieving a 72.4% response rate. Data was collected using structured questionnaires and analyzed using Stata version 17, employing descriptive statistics. The findings revealed a strong positive correlation between savings and profitability (r = 0.930, p = 0.000). Regression analysis demonstrated that savings significantly and positively affect profitability (β = 2.255, p = 0.000). The study concludes that savings constitute a critical determinant of enterprise profitability, providing financial resilience and reinvestment capacity. It recommends strengthening savings incentive programs, linking savings behavior to loan eligibility, implementing financial literacy training emphasizing savings management, and establishing accessible savings infrastructure. Further research should explore sector-specific effects and additional profitability determinants in other countiesItem Credit Insurance and Quality of Loan Portfolio of Microfinance Banks in Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2026-01-02) Muindi, Cellinah Wanza; Koori,Jeremiah; Irungu, Anthony MugethaThe microfinance sector in Kenya has been grappling with deteriorating loan portfolio quality, as evidenced by the 5.55 percent net non-performing loans ratio between 2019 and 2022, exceeding the International Monetary Fund and World Bank's 5 percent vulnerability threshold. The absolute value of non-performing loans escalated from KES 4.198 billion in 2019 to KES 5.718 billion in 2022, creating a critical contradiction where expanded insurance coverage coincided with worsening portfolio performance. Therefore, this study assessed the effect of credit insurance on loan portfolio quality in Kenya's microfinance banks. The research was grounded in risk management theory. The study employed a positivism research philosophy and descriptive research design, targeting all 14 Central Bank of Kenya-regulated microfinance banks. Secondary data spanning 2019-2023 was analyzed using STATA through descriptive and inferential panel regression techniques. Credit insurance was measured as the ratio of insured loan amounts to total loans issued, while portfolio quality was measured as non-performing loans to total loans ratio. The study found that credit insurance has a statistically significant and negative effect on loan portfolio quality in Kenya’s microfinance banks. The results show that each unit increase in credit insurance is associated with a 0.266-unit decline in loan portfolio quality (β = −0.266, p = 0.000), confirming the rejection of the null hypothesis. This indicates that, rather than strengthening portfolio performance, increased reliance on credit insurance may undermine loan quality within the microfinance sector. The study recommends that regulatory bodies, specifically the Central Bank of Kenya, enforce stricter oversight frameworks for credit insurance implementation in microfinance banks to mitigate identified moral hazard effects. Regulations should mandate complementary monitoring systems that maintain rigorous credit appraisal standards and borrower screening processes even when insurance coverage exists, preventing insurance presence from encouraging lax lending practices. Microfinance institutions should integrate enhanced loan supervision mechanisms alongside insurance adoption, including periodic portfolio reviews, borrower repayment behavior monitoring, and insurance claim pattern analysis to detect early warning signals of moral hazardItem Financial Forecasting and Profitability of the Top 100 SMEs in Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2025-12) Mwanzi, James Munyalo; Jagongo, Ambrose; Makori, DanielSmall and Medium Enterprises constitute critical economic drivers in developing economies, yet their profitability remains volatile despite contributing approximately 24% to Kenya's GDP and employing over 93% of the active labor force. This study examined the effect of financial forecasting on the profitability of the Top 100 SMEs in Kenya. An explanatory research design under positivist philosophy was adopted, employing a census approach that selected 40 consistently listed firms from the Top 100 SMEs ranking. Data were collected through questionnaires for primary information and audited financial statements for secondary data, then analyzed using SPSS with linear regression analysis. The results showed that financial forecasting had a statistically significant positive effect on profitability (β = 2.10, p = 0.027), meaning a one-unit improvement in forecasting increased profitability by 2.10 units. With R = 0.36 and R² = 0.13, the model indicated a moderate relationship where forecasting explained 13% of profitability variation, leading to the rejection of the null hypothesis at the 0.05 level. The study concludes that financial forecasting serves as a statistically significant determinant of profitability among Kenya's Top 100 SMEs, with effective forecasting enabling enterprises to predict cash flow fluctuations, manage liquidity prudently, and identify profit-enhancing opportunities. The study recommends that the Kenya MSME Authority should develop standardized financial forecasting training programs targeting SME managers to enhance predictive accuracy and implementation, the Kenya Association of Manufacturers should establish forecasting benchmarking frameworks enabling SMEs to compare practices against industry standards, financial institutions should integrate forecasting capability assessments into credit evaluation processes while providing technical support to borrowers and policymakers should mandate periodic forecast reviews and documentation for SMEs seeking government support programs to institutionalize strategic financial planning practices that demonstrably improve profitability outcomes.Item Financing Options and Financial Growth of Small and Medium Enterprises inKirinyaga County, Kenya(Stratford Peer Reviewed Journals and Book Publishing, 2026-01) Kinyua, Michael Mithamo; Mungai, JohnSmall and Medium Enterprises (SMEs) are crucial to Kenya's economy, serving as its foundation and supporting numerous families. However, accessing financing remains a persistent challenge for these enterprises. While extensive research examines factors affecting SME performance and profitability in Kenya, few studies have explored constraints SMEs encounter in securing financing from various sources and how these challenges relate to overall performance. Most studies focus on industry or macroeconomic factors rather than financing options. This study investigated the effect of financing options on the financial growth of SMEs in Kirinyaga County, Kenya. Specific objectives assessed the effects of equity financing, debt financing, and informal financing on SME financial growth. The study's significance lies in its potential to inform SME owners and policymakers about effective financing strategies that enhance financial growth, ultimately contributing to sustainable SME development in Kirinyaga County and fostering a more robust regional economic environment. Theoretical frameworks including Pecking Order Theory, Trade-Off Theory, and Agency Theory guided the analysis, providing comprehensive understanding of how different financing options affect SMEs. The study employed a descriptive research design involving 139 SMEs selected through Yamane sampling strategy from 213 registered SMEs as of December 2023. A pilot test refined the questionnaire, ensuring clarity and relevance. Data collection utilized structured questionnaires, prioritizing ethical considerations including confidentiality and voluntary participation. Operationalization and measurement of variables defined key constructs related to financing options. Diagnostic tests assessed data quality. Data presentation included descriptive statistics (means and standard deviations) and inferential statistics to establish variable relationships, analyzed using SPSS version 23. Equity, debt, and informal financing demonstrated positive significant effects on SME financial growth in Kirinyaga County. The study concludes that equity financing provides essential capital for expanding operations, investing in new technologies, and increasing market reach. Debt financing enables businesses to invest in expansion, improve operations, and enhance market competitiveness. Informal financing provides crucial capital to SMEs struggling to access traditional bank loans due to stringent requirements. The study recommends that the County develop targeted financial literacy programs educating SME owners about equity financing options and effectively presenting business cases to potential investors. The government should create platforms for SMEs to showcase business plans and financial needs to potential investors and lenders, facilitating connections that could lead to better financing opportunitiesItem Internal Audit Function's Independence and Financial Reporting Quality in Deposit-Taking Saccos in Kenya(StratfordPeerReviewedJournalsandBookPublishing, 2026-01) Nyoro, Annah Njeri; Theuri ,JosephFinancial reporting quality remains a critical concern for deposit-taking savings and credit cooperative societies (SACCOs) in Kenya, with recent scandals highlighting significant deficiencies in financial disclosure and transparency. This study examined the effect of internal audit function's independence on financial reporting quality in deposit-taking SACCOs in Kenya. Grounded in agency theory, the research adopted a cross-sectional design targeting 176 deposit-taking SACCOs regulated by SASRA. Simple random sampling was employed to select 122 respondents from finance, accounting, and internal audit departments. Data was collected using structured questionnaires and analyzed using descriptive statistics, correlation analysis, and multiple regression analysis. The study achieved a 76% response rate with 93 usable questionnaires. Findings revealed that internal audit function's independence had a moderate positive correlation (r=0.458) with financial reporting quality. Regression analysis demonstrated that IAF independence significantly predicted financial reporting quality (β=0.335, p<0.05, t>1.96), explaining 58.2% of the variance in financial reporting quality. The study concluded that strengthening the independence of internal audit functions is crucial for enhancing financial reporting quality in deposit-taking SACCOs. The study recommends that senior managers of deposit-taking SACCOs should remain committed to strengthening the independence of the internal audit function through clear organizational structures, adequate resource allocation, and protection of internal auditors from managerial interference. This research contributes to the understanding of governance mechanisms in cooperative financial institutions and provides practical insights for regulators and SACCO management.Item Bank-Specific Characteristics and Financial Distress of Commercial Banks in Kenya(International Academic Journal of Economics and Finance (IAJEF), 2024-11) Githinji, Mary Wangechi; Simiyu, Eddie; Omagwa, JobEmpirical evidence on the banking industry in Kenya indicates that local banks have been prone to financial distress. Commercial banks in Kenya have been experiencing cycles in Financial Distress and though such cycles have been precipitated by Bank-Specific Characteristics in other countries. It is still a challenge for empirical investigation as to know whether Bank-Specific Characteristics significantly affect Financial Distress in Kenya’s banking industry. Subsequently, the basis of this research was to evaluate the connection between Bank-Specific Characteristics and Financial Distress of commercial banks in Kenya. Explicitly, the research was informed by determining the Income Diversification on Financial Distress of commercial banks in Kenya. The Gambler’s ruin theory and Modern portfolio theory provided theoretical anchorage to the research. Positivism research philosophy and causal research design were adopted for the study. The research was a census of all the 36 fully operational commercial banks in Kenya for the period 2011 through 2019. Secondary data was utilized in this study. Data sources included: websites of the CBK and individual Commercial Banks, audited financial statements and Annual supervision reports. Data analysis entailed use of descriptive and inferential statistics where the latter involved dynamic panel logistic regression analysis. Diagnostic tests undertaken in the study included: model specification, stationarity, autocorrelation, and multicollinearity tests. Hypotheses were tested at a significance level of 0.05. Data was displayed through frequency tables and graphs. Based on the dynamic panel Logistic regression analysis, the research revealed that Income Diversification had a significant effect on Bankometer Score (β=0.3504847, p=0.002) on commercial banks in Kenya. The study recommended that banks should diversify their revenue streams into new business areas and markets while considering risks and capabilitiesItem Cash flow Management Activities and Financial Performance of Manufacturing Firms Listed at Nairobi Securities Exchange, Kenya(International Academic Journal of Economics and Finance, 2022-12) Odhowa, Feisal Matan; Mutswenje, Vincent S.The performance of industrial entities contributes significantly to economic development of Kenyan stock market as well as national economy at large. Adoption of cash flow management activities is intended to improve financial performance yet the financial performance of manufacturing firms continues to remain erratic. Hence, it remains unclear whether cash flow management activities significantly affects the performance of industrial entities. Thus, in view of this background, the study sought to assess the influence of cash flow management activities on the financial performance of industrial firms listed at Nairobi securities exchange, Kenya. The specific objectives of the study are: to examine the influence of cash flow management from operating activities, investing activities and financing activities and how they influence financial performance of industrial firms listed at the Nairobi securities exchange, Kenya. Research hypotheses were tested at 0.05 significance level. This study was guided by three theories, which include Keynesian theory of money, Free cash flow theory and cash flow management theory. The study adopted causal research design. The target population comprised eight manufacturing firms listed at the NSE where the study adopted a census. The time scope of the study is five years, that is, year 2017 to year 2021. A data abstraction tool was used to collect secondary data. It adopted the panel regression model. Descriptive statistics (mean and standard deviation) and panel regression analysis was used to analyse data. The diagnostic tests was carried out before the actual analysis. The data was presented using tables, graphs and frequency tables. The study adhered to ethical considerations accordingly. The inferential statistics revealed that cash flow management from operating activities has a statistically insignificant influence on the financial performance of manufacturing firms (p=0.275>0.05). Cash flow management from investing activities was found to have a statistically insignificant influence on financial performance of manufacturing firms (p=0.125>0.05). The findings show however, firm size was not a significant moderator (p=0.562>0.05) in this study. The study suggested that with the establishment of negative correlation on the financial performance, in pursuit of higher profit and better performance the manufacturing firms can utilize management of cash flows, another study was suggested to be done using the same variables but now using the Return on Equity as the dependent variable. The study suggested similar study to be carried out in other sectors