The Effects of Relationship Banking and Entrepreneurial Orientation on Financial Performance of Manufacturing Firms in Kenya

  • Abraham Kipkemboi Rotich KCA University
  • Kenneth Wanjau Karatina University

Abstract

The purpose of the study was to determine if relationship banking, and entrepreneurial orientation (EO) affect the financial performance of manufacturing firms in Kenya. The study adopted a cross-sectional research design with the population being 620 manufacturing SMEs involved in relationship banking with commercial banks in Kenya. Stratified random sampling was employed to pick a sample of 138 manufacturing SMEs with the respondents being the owner/ managers of the sampled SMEs. A semi structured questionnaire was used for data collection. The data was analyzed regression analysis with the moderating effects of EO being tested using the moderated multiple regression. The study revealed that EO moderates the relationship between relationship banking and financial performance of manufacturing SMEs in Kenya. The study concluded that relationship banking and financial performance have a positive relationship and that EO moderates this relationship. By forging strategic links with the banks, manufacturing SMEs would be able to access funding which is key to their growth and survival.

Keywords: Relationship Banking, Entrepreneurial orientation, Financial Performance

 

Author Biographies

Abraham Kipkemboi Rotich, KCA University

School of Business and Public Management

KCA University

Nairobi, Kenya

Kenneth Wanjau, Karatina University

School of Business

Karatina University

Karatina, Kenya

Published
2017-06-28
Section
Articles

Journal Identifiers


eISSN: 2071-2162
print ISSN: 2072-7992