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Effect of Loan Risk Management Strategies on Financial Performance of Deposit Taking Sacco Societies in the Lake Region Economic Block Kenya

Author

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  • Sabwami, Leah
  • Egessa, Robert
  • Nelima, Mary

Abstract

Purpose: To determine the effect of Loan Risk Management Strategies on Financial Performance of Deposit Taking SACCO Societies in the Lake Region Economic.Design/Methodology/Approach: A mixed-methods research design that was descriptive and correlational was used. The collection of data was done using structured questionnaires administered to key institutional personnel (72 stakeholders from 36 SACCOs) and from financial statements on return on assets. The analysis consisted of descriptive and inferential statistics. &Findings: The descriptive results revealed that loan risk management (grand mean 3.65) were moderately practiced. Financial performance had a strong positive correlation with loan risk management strategies(r = 0.715, p < 0.05). This led to rejection of null hypothesis. Implications/Originality/Value:& The management of SACCO should strengthen risk assessment by employing digital credit scoring systems and alternative data, institutionalizing regular portfolio reviews and early warning systems, and continuous training of staff in risk analytics. &&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&

Suggested Citation

  • Sabwami, Leah & Egessa, Robert & Nelima, Mary, 2026. "Effect of Loan Risk Management Strategies on Financial Performance of Deposit Taking Sacco Societies in the Lake Region Economic Block Kenya," Journal of Business and Social Review in Emerging Economies, CSRC Publishing, Center for Sustainability Research and Consultancy Pakistan, vol. 12(1), pages 169-180, March.
    • Handle: RePEc:src:jbsree:v:12:y:2026:i:1:p:169-180
    DOI: http://doi.org/10.26710/jbsee.v12i1.3763
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