Transnationalism challenges  of Saccos through diaspora accounts : Evidence from a Kenyan Emerging markets

Abstract: A lot of empirical research has been done on Savings and credit cooperative Societies in Kenya for decades but majority have focused more on the challenges that these Sacco’s face. Most of these research have focused on finding ways of increasing the competitiveness of these Sacco’s within a certain geographical region. However, very few literature exists on the challenges that these Sacco’s face in their quest to internationalize and find diaspora customer. Over the years, there has been an increase in Kenyan diasporas sending remittances back home through relatives and friends for the purposes of investments but their efforts have been futile. Some of these diasporas find it difficult to invest in other financial institutions due to bureaucracy and high interest rates. This is where the Sacco’s then come in due to their simple teams and conditions and low interest rates. This thesis sought to establish how Sacco’s in Kenya internationalize and the challenges that they face in the internationalization process. The research followed a quantitative approach whereby four Saccos were Analyzed after semi structured interviews were conducted with the managers of the respective firms. Based on the research conducted, the empirical findings reveal that Saccos in Kenya adopted the network approach of internationalization whereby they establish formal or informal relationships with participants in the foreign markets and that way they are able to influence more networks. The findings also revealed that the main challenges that hinder Saccos from internationalizing are competition, management and governance as well as knowledge and information systems. Geographical distance and competition were not a major challenges as earlier revealed by the literature.