Investment Decisions and Financial Performance of Matatu Saccos with Offices in Nairobi City County, Kenya.
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Date
2024-06
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Kenyatta University
Abstract
Matatu SACCOs in Kenya play a pivotal role from both locally and nationwide
perspective. Even though it is widely known that matatu SACCOs have manifold benefits
to the country, past studies portray controversial debate over linkage between financial
outlay decisions and returns realized over the years. Purposely, this paper endeavored to
test NTSA regulations moderation effect of on the relationship between investment
decisions and financial productivity in terms of performance of matatu SACCOs in Nairobi
City County, Kenya. The specific objectives were, to determine the influence of
replacement decision by matatu owners on financial performance of matatu SACCOs with
offices in Nairobi CBD, Kenya, to examine the influence of modernization decision by
matatu owners on financial performance of matatu SACCOs with offices in Nairobi CBD,
Kenya, to evaluate the influence of diversification decision by matatu owners on financial
performance of matatu co-operatives with offices in Nairobi CBD, Kenya and to assess the
NTSA regulations moderation implications on the linkage of investment decisions and of
matatu SACCO financial performance with offices in Nairobi CBD, Kenya. The research
project is anchored on modern financial theory, risk and uncertainty-bearing theory of
profit and opportunity cost’ theory. This research applied descriptive survey research
design. The four hypotheses were tested at 95% confidence level using multiple both
multiple and Hierarchical regressions models. The target population is 625 matatu
SACCOs registered under the national transport and safety authority out of which with use
of stratified sampling method selection of a sample size of 206 was obtained. Then again,
with use of a structured questionnaire, data needed was collected via the drop and pick
methodology was applied. Research findings portrayed that replacement investment
decision influenced financial performance of Matatu SACCOs which was direct and
significant. Again, modernization investment decision influenced financial performance of
Matatu SACCOs which was negative and statistically significant, diversification
investment decision caused a significant financial performance of Matatu SACCOs which
was direct and lastly NTSA regulations portrayed a statistically significant moderation
effect on investment decisions to matatu SACCO financial performance conceptual
connection. The results portray that government is able to establish policies which can
guide on transport sector operations which promote matatu SACCO financial performance
and by extension raise its tax base. The top management of the matatu SACCOs have an
in-depth conceptual linkage between investment decisions they make and the financial
performance implication which help them improve their financial sustainability through
increased profitability. The academicians have a base of further debate on aspects of
investment decisions which can significantly influence financial performance of matatu
SACCOs.
Description
A Research Proposal Submitted to the School of Business Economics and Tourism in Partial Fulfilment for the Award of Degree in Master of Business Administration (Finance Option) of Kenyatta University June, 2024