Effect of Financial Technology Adoption on the Financial Performance of Deposit-Taking Savings and Credit Cooperative Societies (SACCOs) in Kenya

Purpose: The aim of this study was to investigate the effect of financial technology adoption on the financial performance of deposit-taking savings and credit cooperative societies (SACCOs) in Kenya. Methodology: The study adopted a desktop research methodology. Desk research refers to secondary data or that which can be collected without fieldwork. Desk research is basically involved in collecting data from existing resources hence it is often considered a low-cost technique as compared to field research, as the main cost is involved in executive’s time, telephone charges and directories. Thus, the study relied on already published studies, reports and statistics. This secondary data was easily accessed through the online journals and library. Findings: The study suggests that financial technology adoption, particularly mobile banking, digital lending, internet banking and automated financial management systems, has the potential to positively influence the financial performance of deposit-taking SACCOs in Kenya. Adoption of these technologies may enhance operational efficiency, reduce transaction costs, improve loan management and increase profitability. However, the extent of these benefits depends on effective technology implementation, institutional capacity, cybersecurity measures and members’ utilization of digital financial services. Unique Contribution to Theory, Practice and Policy: The technology organization environment framework, diffusion of innovations theory & financial intermediation theory may be used to anchor future studies on effect of financial technology adoption on the financial performance of deposit-taking savings and credit cooperative societies (SACCOs) in Kenya. The study is expected to provide practical insights that will assist SACCO managers, boards of directors and financial technology providers in making evidence-based decisions regarding digital transformation investments. The study is expected to provide empirical evidence to inform the development and improvement of policies governing financial technology adoption among deposit-taking SACCOs in Kenya.