Determinants of investment decisions on financial Performance of matatu non deposit taking saccos in Nakuru City county, Kenya

Abstract

In Kenya, matatu SACCOs are essential from a local and national standpoint. Although it is commonly acknowledged that matatu SACCOs offer numerous advantages to the nation, previous research has shown a contentious dispute over the relationship between financial outlay choices and returns over time. Purposely, this study aimed to test NTSA regulations moderation effect of on the relationship between factors influencing investment decisions and financial productivity in terms of performance of matatu SACCOs in Nakuru City County, Kenya. The specific objectives were ;to determine the influence of replacement decision by matatu owners on financial performance of matatu SACCOs in Nakuru CBD, Kenya, to examine the influence of modernization decision by matatu owners on financial performance of matatu SACCOs in Nakuru CBD, Kenya, to evaluate the influence of diversification decision by matatu owners on financial performance of matatu co-operatives in Nakuru city CBD, Kenya and to assess the NTSA regulations moderation implications on the linkage of investment decisions and of matatu SACCO financial performance with offices in Nakuru city CBD, Kenya. Opportunity cost theory, risk and uncertainty-bearing theory of profit, and contemporary financial theory served as the foundation for the research project. The target population consisted of 625 Matatu SACCOs that are registered with the National Transport and Safety Authority; 206 of them were selected using the stratified sampling approach. For both validity and reliability to be guaranteed in this research prior testing was undertaken at Kisumu city. A structured questionnaire was employed, and data was gathered using the drop and pick technique. The descriptive survey research design was used in this study. The four hypotheses were tested by multiple regression and hierarchical models at a 95% confidence level. The research findings demonstrated that replacement investment decisions had a direct and significant impact on the financial performance of Matatu SACCOs. Again, modernization investment decision influenced financial performance of Matatu SACCOs, which was negative and statistically significant; diversification investment decision caused a significant financial performance of Matatu SACCOs, which was direct; and finally, NTSA regulations exhibited a statistically significant moderation effect on investment decisions to matatu SACCO financial performance conceptual connection. The findings show that the government is capable of establishing regulations that can steer transportation sector operations, thereby improving matatu SACCO financial performance and, as a result, increasing its tax base. The senior management of matatu SACCOs understands the conceptual linkage between investment decisions and the resulting financial performance, which helps them improve their financial sustainability through greater profitability. Academicians can continue to argue parts of investment decisions that have a substantial impact on the financial performance of matatu SACCOs.