EFFECT OF LOAN RECOVERY STRATEGIES ON CREDIT CONTROL AMONG SACCOS IN NYANDARUA COUNTY, KENYA
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Abstract
Effective credit control is essential for the financial sustainability of Savings and Credit Cooperative Societies (SACCOs), particularly in managing loan delinquency and repayment challenges. This study examined the effect of loan recovery strategies on credit control among SACCOs in Nyandarua County, Kenya. Guided by the Loan Recovery Model, the study adopted a quantitative research design. The target population comprised employees directly involved in credit control in registered, active SACCOs in the county. Of the 204 targeted respondents, 188 participated, yielding a response rate of 92.2%. Data were collected using semi-structured questionnaires and analysed using descriptive statistics, Pearson’s product–moment correlation, and simple linear regression. The findings revealed a positive, statistically significant relationship between loan recovery strategies and credit control ((r = .463), (p < .01)). Regression analysis further indicated that loan recovery strategies significantly predicted credit control ((B = 1.850), (\beta = .463), (t = 7.12), (p < .001)), explaining 21.4% of the variance in credit control ((R^2 = .214)). The study concludes that loan recovery strategies contribute significantly to credit control among SACCOs. It recommends strengthening systematic loan monitoring and follow-up, standardising recovery procedures, expanding appropriate loan restructuring mechanisms, enhancing staff capacity, and consistently applying guarantor, collateral, and formal enforcement mechanisms where appropriate.
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References
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