Factors Influencing the Financial Sustainability of Savings and Credit Co-operative Societies in Tanzania

Jacob, Godfrey J. (2023) Factors Influencing the Financial Sustainability of Savings and Credit Co-operative Societies in Tanzania. Doctoral thesis, The Open University of Tanzania.

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Abstract

The study assessed the factors influencing the financial sustainability (FS) of SACCOS in Tanzania. Specifically, the study examined the influence of outreach, corporate governance, credit risk management and monetary motivation on the FS of SACCOS. Using multi-stage and random sampling, the study generated a sample of 100 SACCOS. The resultant data were subjected to descriptive, multiple, and panel data regression analyses. Moreover, the study applied the random effect regression model and Hausman test with the help of the Stata software to analyse the influence of outreach on the FS of SACCOS. Furthermore, the study applied the SPSS software and multiple regression to analyse the influence of corporate governance, credit risk management, and monetary motivation on the FS of SACCOS. Then the variables were confirmed using principal components and factor analysis. The study used OSS as a proxy of FS which was a dependent variable. It was discovered that SACCOS in the areas of the study are financially sustainable. Also, the study found significant effects of outreach, corporate governance, credit risk management and monetary motivation variables on the FS of SACCOS. As such, the study recommends that the Bank of Tanzania should formulate policies that promote outreach, corporate governance, credit risk and monetary motivation to further enhance the FS of SACCOS in Tanzania. Overall, the study contributes to Agency and Institutional Theories by integrating the four variables into one study and using SACCOS as semi�formal financial institutions operating using co-operative principles. Keywords: SACCOS, Financial Sustainability, Outreach, Corporate Governance,Credit Risk Management, Monetary Motivation

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