INFLUENCE OF COLLECTION EFFORT ON NON-PERFORMING LOANS IN DEPOSIT TAKING SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN KAKAMEGA COUNTY
Abstract
It is argued that the non-performing loans are one of the major causes of the economic stagnation problems and the current study aimed to examine the influence of collection effort on non-performing loans in DTSs in Kakamega County. The descriptive research design was selected as it helped in establishing the relationship between group borrowing and non-performing loan in DTSs in Kakamega County. The population of this study was 72 employees of 3 registered DTSs within Kakamega County. The study adopted the entire target population of 72 as the study respondents using Census since the staff in the sampled SACCOs were limited in numbers. A Likert scale Questionnaire was used to gather primary information while secondary data information was obtained from articles, books, newspapers, internet and magazines. Content, Criterion and construct validity was tested while reliability was determined by Cronbach Alpha at 0.7 and above. Data was analyzed using both descriptive statistics using frequencies, means and standard deviations as well as inferential statistics using correlation and regression. Information was sorted, coded and input into the statistical package for social sciences (SPSS) version 22.0 for production of graphs and tables. Inferential results revealed that collection force affected non-performance loans. Collection force negatively affected non-performance loans of DTS in Kakamega County. The study recommended that DTSs should involve credit/field officers and customers in formulating customized credit collection policies that positively attract customers as this would reduce loan delinquency, improve market share and consequently influence non-performing loans.
Key Words: Loan Collection Efforts, Non-performing Loans
CITATION: Shiyonzo, A. B., & Malenya, A. (2020). Influence of collection effort on non-performing loans in deposit taking Savings and Credit Cooperative Societies in Kakamega County. The Strategic Journal of Business & Change Management, 7(3), 898 – 911.
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DOI: http://dx.doi.org/10.61426/sjbcm.v7i3.1715
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