THE ROLE OF COMMUNICATION IN SACCOS IN PROMOTING FINANCIAL INCLUSION IN KENYA

Financial inclusion is a prerequisite to economic development. This has been echoed by international as well as national bodies. Studies have shown that financial exclusion has its roots in social exclusion. This indicates the depth and importance of financial inclusion in creating inclusive development. Numerous studies have revealed levels of financial inclusion with limited studies performed on the role of SACCO initiatives on financial inclusion. This research examined measures of financial inclusion which include both access and usage of financial products by low income earners and the socially excluded via SACCOs. Since access and usage are supplementary, they reflect a more vivid picture of financial inclusion. The study sought to analyze the role of SACCOs in promoting financial inclusion in Kenya. The study was guided by the three specific objectives: geographical coverage of SACCOs; cost and contribution of SASRA regulations towards enhancing financial inclusion. To achieve the objectives of the study a descriptive survey research was adopted. The target population was the three SACCOs in Meru town. 43 questionnaires were issued to SACCO members to access the level of financial service access. Primary data was analyzed with aid Microsoft excel software to generate frequencies, mean and percentages. Pie charts, graphs and tables were used to present various aspects of the variables. Content analysis was used to analyze qualitative while quantitative data was analyzed using descriptive statistics. JEL: O10; O20; G10; G20  Article visualizations:


Introduction
This chapter contains the methodology of the research. It's made up of the research design to be used, the target population, research instruments, sample size and sampling procedures, data collection and data analysis.

Research Design
A descriptive research design was adopted for the study. This is because descriptive survey attempts to describe the behavior and characteristics of a subject without influencing it in any way (Bryman, 2001). It is designed to gain more information about variables and provide accuracy within specified ranges of error in a particular field of study and thus such a design will be the most appropriate. Descriptive survey will involve administering a questionnaire to a sample of individuals.

Target Population
The study population involved three SACCOs in Meru town and its three divisions which are actively involved in drawing the tea and coffee farmers into financial system. SACCOS were selected because of their deep market penetration and hence considered to have a grip of financial inclusion activities. The study involved sampling of all the three SACCO divisions in Meru municipality. A target population of 196 members was available.

Sampling Procedure
The study adopted a sampling survey of all the 3 divisions in the area. This is because Israel, 1992 recommends that the population should be sampled when the population is 200 or more. The sample size was 43 SACCO members. The sample size will comprise 4 executives and 39 customers. The sample size for the executives was a census taken based on department while sample size for employees was computed using the following formula. n= N/ (1+n (e) ^2

Data Collection
The researcher used both primary and secondary data; questionnaires were used to gather primary information from the field. The questionnaire comprised the closed and open ended questions. Open ended questions were used to encourage the interviewee to provide an extensive and developmental answer. For more objective and specific answer closed ended questionnaire were administered. Secondary data was obtained through desk research from internal and external sources. The external sources included publications, reports, newspapers and libraries. Forty three questionnaires were issued to the 4 SACCO heads of departments and 39 members in the 3 divisions.

Reliability
Reliability is the extent to which a questionnaire, test, observation or any measurement procedure produces the same results on repeated trials (Miller, 2009). It is the stability or consistency of scores over time or across raters. Reliability co-efficient was be obtained by correlating the scores of odd numbered statement with the score of even numbered statement in questionnaire. The researcher used test-retest to ascertain the coefficient of internal consistency or reliability. The instrument will be administered twice to the same group of subjects at an interval of two weeks.

Validity
Validity refers to the extent which an instrument does the measurement of what it is supposed to measure (Kothari, 1985). It can also refer to the extent to which the results of analysis of data from the given phenomenon of study are representative. The validity in the study was enhanced through the appraisal and verification of tools by the supervisor who is an expert. The questionnaire was also made subject to a thorough test and retest procedures with examination of my supervisor whereby any improvements necessary were incorporated. The validity of the content in the study was enhanced through comparison with specific benchmarks.

Data Analysis
Data analysis is the coding, categorizing, data entry, manipulation and summarization of data (A.Mugenda, 2003). The filled questionnaires were checked cleaned and edited to ensure that they are correctly and completely filled. Qualitative data generated was analyzed using descriptive statistics such as frequencies and percentages. The data collected was analyzed using descriptive statistics. This includes tables, bar charts pie charts and percentages.

Introduction
This chapter presents the findings of the study and their discussion in relevance to the objectives and past studies carried out in same area. Quantitative data was analyzed using micro soft excel in the form of frequencies, means, modes and percentages. Qualitative data was presented by content analysis. Presentation was done using tables, charts and graphs for easy yet effective communication. Data analysis aimed to answer the following questions  To what extent has the vast geographical coverage of SACCOs promoted financial inclusion?  Is there a significant contribution of SACCOs low cost of financial services to financial inclusion?  How has the SASRA regulations promoted financial inclusion? 4.1.1. Response Rate The researcher administered questionnaire to 43 members of Yetu SACCO 4 of them being heads of the 3 SACCO divisions and 38 SACCO members. From the 42 questionnaires issued only 1 was not answered. This accounts for a response rate of 97.6 percent which is a representative of the whole population and therefore can be relied on for analysis in this study.

Respondent Profile
The researcher collected background data of the SACCO members. This was in order to establish the characteristics' of the people being excluded. These include gender, age, and level of education.

Age of SACCO Members
The researcher sought to find out the age of various customers of SACCO who were respondents in the study

Gender of SACCO Clients
The researcher sought to find out the gender of various members who were respondents in the study

Figure 1: Gender of Respondents
The findings in fig 4.2 indicate that majority (65%) of SACCO clients were of male gender and 35% were female. The findings point to a gender inequality which is a rampant issue among the middle class communities in Kenya. The findings are in agreement to findings by (UN Habitat, 2003) which found that approximately 70% of women are socially excluded and financial exclusion is the root cause of social exclusions.

Level of Education of SACCO Members
The researcher sought to find out the highest academic qualification achieved by various SACCO members who were the respondents in the study.

Figure 2: Level of SACCO Members Education
Findings in table 4.1 indicate that majority (43%) of SACCO members had a diploma certificate as their highest level of education. This shows that majority of the people who are banking with SACCOs have general understanding of information concerning SACCOs sought by the study. However for the SACCO executive section all had bachelor's degree.

Sacco Members Income Level
The researcher sought to find out the income levels of SACCO members who were respondents in the study

Figure 3: Income Level of SACCO Members
The findings in figure 4.4 indicate that majority (43%) of SACCO members income level lies between 21000 and 30000 shillings. When commercial banks increased their minimum account balances in the 1990s this income bracket was locked out of financial system.

Marital Status of SACCO Members
The researcher sought to find out the marital status of SACCO members who were respondents in the study

Figure 4: Marital Status of SACCO Members
Findings in figure 4.4 reveal that majority (50%) of SACCO members were married. This shows married people sought financial services to plan their lives and that of their children e.g. pension.

Financial Inclusion
The purpose of this study was to evaluate the role of SACCO in promoting financial inclusion in Kenya. Financial inclusion was measured by the number and frequency of transactions as well as number of accounts opened via SACCOs. As such the researcher sought to find out these details from both SACCO members and managers 4.3.1. Commonly used Service The researcher sought to find out what banking service was most sought by customers at SACCOs outlets.

Figure 5: Commonly Used Service
According to majority (56%) of SACCO members' cash withdrawal was the most popular banking service sought by customers.

Number of Accounts Opened in a Day
The researcher sought to establish the number of accounts opened at the SACCO branches from branch managers.   (2) of SACCO opened between 21-30 accounts for customers. This shows that account opening was a highly sought service by customers. These findings depict the high rate of financial inclusion activities by SACCOs since it is measured via number of accounts opened and financial service usage.

Effect of SACCO Banking On Financial Inclusion
The researcher sought to find out from bank branch manager the extent to which SACCOs induce financial inclusion

Effect of Geographical Coverage On Financial Inclusion
This section presents findings related to the first objective of study sought to find out the extent to which geographical coverage of SACCO has promoted financial inclusion

Closeness of SACCOs to Customers
The researcher sought to find out from SACCOs whether closeness to customers had an impact on the number of services sought. Majority (76.2%) of SACCO members agreed that some customers prefer SACCOs because they are closer to them as compared to commercial banks. Geographical coverage is one the strengths of SACCOs as services offered by banks are brought closer to the people. These findings are in agreement with previous studies which found that SACCO banking has enabled bank customer to access the SACCOS within comfort of their neighborhoods. (Musau, 2013)

Reduction of Overcrowding In Banking Halls
The researcher sought to find out from the managers whether greater geographical coverage of SACCOs had reduced overcrowding in banking halls All (n=4) managers agreed that SACCOs reduce overcrowding because more people are utilizing SACCOs since they get served faster.

Time Taken to Access Financial Service
The researcher sought to find out the time taken by SACCO members to access financial services at the SACCO outlet. Majority (83%) of SACCO clients took below ten minutes to get served at SACCOs. This is because SACCOs generally have fewer clients compared to commercial banks. Further most SACCOs today have adopted modern technologies which speed up and simplify work.

Distance Travelled by Customers to Access SACCOs
The researcher sought to find out the distance travelled by SACCO members to access financial services at the nearest SACCO outlet. Vol 8 Issue 1 DOI No.: 10.24940/theijbm/2020/v8/i1/BM2001-020 January, 2020 Most of the members indicated that they travelled between two and five kilometers to access the nearest SACCO outlet and get served. These points to the vast geographical coverage of SACCOs in Kenya.

Effect of Geographical Coverage of SACCOs on Financial Inclusion
This study helps to find the degree up to which geographical exposure of SACCOs has promoted financial inclusion. This information has been obtained from SACCO branch managers. One interesting finding has revealed that SACCOs bank services are brought closer to customers both bank and non bank. This finding is in line with Invatury and Timothy, 2006 who found that SACCOs benefitted clients in the following ways lower transaction cost (proximity), longer opening hours, shorter lines, more accommodative of illiterate and poor who are panicky by marble banking halls.

Impact of Cost at SACCOs on Customer Seeking Financial Service
The researcher put forward several statements related to costs of services at the SACCO offices.

Effect of Cost of Service on Financial Inclusion
The researcher sought to find out from SACCO branch managers on the impact of cost of service on financial inclusion Majority (75%) of SACCO branch managers indicated that cost of service had great effect on financial inclusion. This can be attributed to the fact that majority of customers were low income earners and depend much on loans. These findings are in agreement with past studies which found that the cost of financial services in commercial banks was a deterrent to customers. (Mussau, 2013)

SASRA Regulation
This section presents findings related to the third objective of the study which sought to find out the effect of SASRA regulation on financial inclusion

Maximum and Minimum Cash Limits
The researcher sought to find out from SACCO branch managers whether SASRA authorities dictated maximum and minimum cash limits they should hold. All (n=4) Table 9: Customer Confidence Majority (78.1%) indicated that lack of SASRA regulations makes customers lose confidence in SACCOs and stay locked out of financial service playground. These findings are in agreement with financial sector deepening trust report (FSDT, 2012) which has shown remarkable upward trend in SACCO subsector confidence since inception of SASRA.

Quality of Service
The researcher sought to find out from SACCO customers whether quality of financial services has increased since inception of SASRA.

Response
Frequency Percentage Strongly Agree  5  12  Agree  34  81  Disagree  2  5  Strongly Disagree  1  2  Total  42  100  Table 10: Quality of Service Majority (81%) agreed that quality of service has improved since SASRA regulations were enacted. This has boosted the image of SACCOs hence financial inclusion.

Frequency of Cash Shortages
The researcher sought to find out from SACCO branch managers the frequency of cash shortages in SACCOs. All (n=4) branch managers indicated that shortage of cash has not been reported since inception of SASRA regulations. This points to effectiveness of SASRA regulations in ensuring financial soundness of SACCOs. 4.9 Effect of SASRA Regulation on Financial Inclusion The researcher sought to find out from SACCO branch managers whether SASRA regulations had any impact on financial inclusion. All (n= 4) agreed that SASRA regulations had positively affected financial inclusion. This is deduced from ongoing growth in numbers in leaps and bounds. Financial unsoundness of one SACCO has adverse effect on all others since customers evaluate confidence in financial sector as a whole.

SASRA Licensing
The researcher aims to find whether Yetu SACCO was licensed by SASRA. All (n= 4) agreed that the SACCO was licensed and therefore legally operated the FOSA services. This showed the researcher that the SACCO executives were in a position to understand the information sought by the study relating to effect of SASRA on financial inclusion.

Factor with Greatest Effect on Financial Inclusion
Geographical coverage has been revealed to be created most effect on financial inclusion. This was ascribed to enormous exposure of SACCOs and rarity of commercial banks in rural areas.

Introduction
This chapter summarizes the findings and the researchers' conclusions and recommendations.

Summary of the Findings
Many studies have collectively concluded that a huge population is financially excluded, finally part of social exclusion. They can't take part in social and economic activities of the country leading to inequality. Most initiatives need to be taken to address the issue of financial inclusion expeditiously to avoid creating financial instability. Government roles need to clearly define along with proper banking models.

Effects of Geographical Coverage on Financial inclusion
On the effect of geographical coverage of SACCOs on financial inclusion, the study found that majority (75%) of customers agreed that they prefer SACCOs because they are closer to them as compared to main bank.

Cost of Services and Financial inclusion
On the effect of SACCOs cost of service on financial inclusion the study found that costs of accessing services at SACCOs were less compared to commercial banks. Majority (63%) of SACCOs members agreed that they perceive cost of banking with Sacco's to be low. However despite this perception, customers prefer to use SACCOs regardless of cost charged as indicated by majority (75%) of the customers. Majority of SACCOs managers indicated that cost of services at saccos had great effect on financial inclusion.

SASRA Regulation and financial inclusion
On the effect of SASRA regulations on financial inclusion the study found that all (n=4) of branch managers confirmed that SASRA authorities had dictated cash limits that the SACCOs could hold. Majority (78%) of the SACCOs customers agreed that SASRA regulations had boosted their confidence in SACCOs unlike before regulations were enacted. Quality of financial services by SACCOs has been trending skywards due to effectual supervision and disclosures by SASRA authorities and publications. This is according to majority of SACCOs customers. All (75%) of managers agreed that SASRA regulations affected financial inclusion to a great extent.

Discussion
In this section the findings of the study are discussed and related to the findings in the literature review as per objective.

Geographical Coverage and Financial inclusion
The study found that SACCOs had brought banking services closer to the people. The increase of accounts opened through SACCOs can be attributed to the closeness of banking services to the residential and business premises. Prior to introduction of SACCO model in Meru county customers had to physically present themselves at the banking halls to make all transactions. The disadvantage of this is that there was very long queues' leading to time wastage. Saccos today have been able to decentralize this process allowing customers to open accounts, make deposits and withdrawals within the comfort of their residential areas. These findings are in agreement with Invatury and timothy (2006) who found that SACCOs benefited clients in the following ways; lower transaction cost (closer to client home), longer opening hours, shorter lines than in commercial banks, more accessible for illiterates and the very poor who might feel intimidated in marble bank outlets.

Cost of Service and Financial inclusion
The study established that cost of services at SACCOs were lower than costs at commercial banks. Findings further reveal that SACCOs are financially attractive to them regardless of costs. These findings are in agreement with Musau (2012) who in a study concerning cost in commercial banks revealed that cost of finance was a deterrent to more customers using financial products. Customers would prefer SACCOs regardless of costs because of other benefits attributed to SACCOs such as close proximity to customers. Low costs have increased financial inclusion in terms of usage of products.

SASRA Regulation and Financial Inclusion
The findings of this study reveal that SASRA regulations have led to improvement of quality of financial services since their inception. Customer confidence has also been boosted by SASRA regulations. This is partly due to stringent requirements for liquidity management and disclosure of inside financial information to members who are able to take action incase collapse is imminent. If problems of liquidity recur, customers may lose confidence in SACCOs creating a barrier to financial inclusion. These findings are in agreement with financial sector deepening researchers. (SASRA, 2014).

Conclusions
The study concludes that financial inclusion intervention measure should continue, the array of products that make up financial inclusion should be identified, provided and diversified. Proper measures of financial inclusion which include both access and usage should be applied, since access and usage are not the same but supplementary 6.4.1. Geographical Coverage and Financial inclusion SACCOs have brought banking services closer to the people; in this way SACCOs promote financial inclusion. This is evidenced by fact that customers were willing to forego the extra cost of financial service should any arise at SACCOs. Therefore geographical coverage is a significant driver of financial inclusion