Abstract:
The purpose of this study was to examine the factors affecting Deposit Taking
Microfinance Institutions’ financial performance in Nairobi County. Research was
guided by the following research objectives: Does technological innovation affect
microfinance institutions performance in Nairobi; Does accountability in leadership
affect microfinance institutions performance in Nairobi; Does leadership structure
affect microfinance institutions performance in Nairobi; Does capital structure affect
microfinance institutions performance in Nairobi? The study adopted a quantitative
research methodology and a descriptive design. The target population was 132 from
which a sample of 132 was to be selected through a census method. A Likert scale
type questionnaire was used to collect data from the subjects. This was distributed by
the researcher to twelve DTMFIs within Nairobi County with an exclusion of one
which requested not to be part of the study. A sample of 103 participants out of the
132 took part in the study. The findings revealed that technological innovation has
significant (β=.192, while p = 0.018) relationship with financial performance of
DTMFIs in Nairobi County. Further the findings revealed that leadership
accountability has no significant (β= -.028, whereas p = .324) relationship with
financial performance of DTMFIs in Nairobi County. In addition, the findings
revealed that leadership styles has significant (β=.350, while p = 0.002) relationship
with financial performance of DTMFIs in Nairobi County. Lastly the findings
revealed that resource allocation has a significant (β=.344, while p = 0.002)
relationship with financial performance of DTMFIs in Nairobi County
