INFLUENCE OF PROFITABILITY ON DIVIDEND PAYOUT IN DEPOSIT-TAKING SAVINGS AND CREDIT CO-OPERATIVES (SACCOS) IN KENYA

Abstract

SACCOs' dividend payment strategy varies as to what determines the amount of dividend to pay to its shareholders, how? and when? While working in the same market, some Saccos pay more, while others pay less. Therefore, among the aspects of corporate finance, the strategy of dividend payout is not coherent and attracts a lot of debate among Saccos. The study's general objective was to establish the financial determinants for the dividend payout scheme among Saccos in Kenya between 2018 and 2021. The research design adopted for this study was descriptive. All 166 Saccos in Kenya were targeted by the researcher. Taro Yamane was used for sampling 62 DT-Saccos. Secondary data was obtained using a secondary datasheet. Descriptive statistics included the use of mean, standard deviation, frequency, and percentages. Besides, inferential analysis including correlation and linear regression analysis were used. Data was presented on tables and narratively interpreted. The study revealed that profitability and dividend payout had a β= 0.889, t=6.217, and associated p-value of 0.001. The study concluded that profitability had a positive and significant influence on the dividend payout in deposit-taking Saccos in Kenya. The study recommended for measures to be put in place that ensure that profits increases to have a higher payout of dividends in the DT- SACCOs in Kenya such as reduction in the costs of operations and costs of production to increase in profits