Digital Transformation: A Study of how SACCO Members in Kenya Experience Financial Inclusion through Digital Financial Services

Juliana N. Kamau; David M. Mathuva; S. Wagura Ndiritu

doi:10.23762/FSO_VOL12_NO1_7

Published : 2024-03-31

Vol. 12 No. 1 (2024)

Digital Transformation: A Study of how SACCO Members in Kenya Experience Financial Inclusion through Digital Financial Services

Juliana N. Kamau

https://orcid.org/0000-0003-4019-9977

David M. Mathuva

https://orcid.org/0000-0002-8156-8268

S. Wagura Ndiritu

https://orcid.org/0000-0002-8463-3758

DOI: https://doi.org/10.23762/FSO_VOL12_NO1_7

Abstract

Financial inclusion has gained prominence as a critical element for sustainable development and inclusive growth. Saving and Credit Cooperative Societies (SACCOs) in Kenya play a vital role in providing financial services to their members, particularly those who are underserved by traditional banking institutions. However, limited access to financial services remains a significant challenge. This conference paper investigates how the adoption of digital financial services influences financial inclusion among members of saving and credit cooperative societies in Kenya. Survey data were collected from 334 randomly selected SACCO members. This study employed probit regression analysis to assess the hypotheses developed. The findings of the research support the hypothesis that the adoption of digital financial services positively influences financial inclusion among SACCO members. The analysis revealed that the implementation of digital financial services (DFSs) has significantly expanded financial access for previously underserved populations. Members now have convenient and efficient channels to save, borrow, and manage their finances, leading to increased economic empowerment and reduced inequalities. Moreover, the adoption of digital financial services has streamlined SACCO operations, improving efficiency, transparency, and accountability. This has aided SACCOs in serving their members' financial needs more effectively.

Keywords:

digital financial services, financial inclusion, SACCOs, credit unions.

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Kamau, J. N., Mathuva, D. M., & Ndiritu, S. W. (2024). Digital Transformation: A Study of how SACCO Members in Kenya Experience Financial Inclusion through Digital Financial Services. Forum Scientiae Oeconomia, 12(1), 139–150. https://doi.org/10.23762/FSO_VOL12_NO1_7

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