ABSTRACT

SACCOs are on the forefront to offer financial services to their members; but they encounter with countless problems such as lack of customer care services, lack of good governance, weak member confidence, and inadequate use of technology, insufficient financial services, high registration costs and increasing interest rates among others. Therefore, there exists a gap in literature, which this study aims to fill by establishing the influence of service quality on customer retention among deposit taking Saccos in Kenya with key on Mwalimu National Sacco Nairobi. The study’s general objective was to determine the influence of service quality on customer retention among deposit taking Saccos in Nairobi, Kenya. The specific objectives include; to examine how service flexibility influence customer retention at Mwalimu National Sacco; to determine how resource utilization influence customer retention at Mwalimu National Sacco; to access how service innovation influence customer retention at Mwalimu National Sacco. The accessible population of the study are active members drawn from three (3) Mwalimu National SACCO branches in Nairobi. Descriptive research design was adopted to conduct this study. The target population was drawn from the membership of these three (3) branches under study. Data collection was by means of a semi-structured questionnaire utilizing both closed and open-ended questions. Qualitative data was analysed via the coding of themes and concepts from which generalization was conducted. Data was analysed using descriptive statistics (frequency distribution tables). Inferential statistics used included ANOVA techniques and correlation analysis. The questionnaire was pre-tested to establish the reliability and viability of the questionnaire instrument. The study findings revealed that there is a statistical relationship between service flexibility and customer retention. The study further established that resource utilization is a determinant of customer retention. The study also noted that service innovation is a contributor to customer retention. The study recommends on the need to carry out the same research in other branches of Mwalimu National Sacco countrywide to confirm if the same opinion is held by members in order to make inferences.