Research Journal of Business and Finance

Demand-side firm-specific determinants of access to financial services among local civil contractors in selected regions of Tanzania

2025-08-25T08:12:20+00:00

This study investigated the demand-side, firm-specific determinants influencing access to financial services among local civil contractors (LCCs) in selected regions of Tanzania. Primary data were collected from 354 LCCs using a mixedmethods approach and analysed through multiple linear regression. The study examined the influence of firm size, collateral availability, interest rates, documentation procedures, and firm age on financial accessibility. The results revealed that collateral availability (β = 0.385, p = 0.000), interest rates (β = – 0.217, p = 0.000), bureaucratic documentation procedures (β = – 0.115, p = 0.000), and firm size (β = 0.162, p = 0.001) significantly affect access to finance. In contrast, firm age (β = 0.048, p = 0.141) does not significantly influence credit access. Qualitative findings further support the view that high interest rates and complex documentation remain key obstacles for LCCs. The study concludes that internal firm characteristics substantially influence financial accessibility, with size and collateral acting as enablers, while interest rates and bureaucracy hinder access. Based on these findings, the study recommends that policymakers and financial institutions promote business development and formalisation of LCCs, adopt flexible collateral frameworks (such as movable assets and guarantee schemes), lower interest burdens, and streamline loan procedures through digitisation and simplification. These targeted reforms can enhance financial inclusion, thereby strengthening the capacity and sustainability of LCCs in Tanzania. The study adds to the limited literature on LCC financing in sub-Saharan Africa, offering demand-side insights to inform policy and institutional action.

Debt financing and sustainable SME growth in Sub-Saharan Africa: A qualitative perspective from Uganda

2025-08-25T08:24:13+00:00

This research examines the impact of structured debt financing, including loan size, interest rate, and maturity, on the sustainable growth of small and medium-sized enterprises (SMEs) in Lira City, Uganda. Data were collected using a qualitative interpretative phenomenological analysis (IPA) approach through semi-structured interviews with owners and senior managers of SMEs across various sectors. Thematic analysis was performed utilizing Braun and Clarke’s six-phase method. The findings indicate that although SMEs can access credit, the loan structure frequently hinders business growth because of limited disbursed amounts, elevated interest rates, and short repayment periods. Participants identified difficulties in obtaining debt, including strict collateral demands and complex loan procedures, along with post-disbursement challenges such as undisclosed fees and rigid repayment terms. In light of these constraints, SMEs exhibited adaptive behaviours including structured repayment planning, financial discipline, and cautious borrowing, which indicate informal financial literacy and strategic decision-making. The behaviours observed correspond with the Trade-Off Theory of Capital Structure and the Sustainable Growth Theory, elucidating how SMEs manage financial risks to maintain operations. The research is confined to SMEs in Lira City and may not comprehensively reflect experiences in other areas; subsequent studies could incorporate quantitative methods or expand geographic scope. The study advocates for inclusive and transparent lending practices, including the relaxation of collateral requirements, stabilization of interest rates, clear disclosure of all loan costs, provision of flexible repayment schedules, and investment in financial literacy programs to enhance the resilience and growth of SMEs.

Assessing the effect of client–consultant–contractor relationships on quality assurance in road construction: Evidence from the Dar es Salaam Metropolitan development project, Tanzania

2025-08-25T08:29:36+00:00

Ensuring quality assurance in road construction remains a persistent challenge in Tanzania, largely due to fragmented collaboration and communication among key stakeholders, namely the client, consultant, and contractor. Despite the critical role these actors play in achieving quality infrastructure outcomes, limited empirical evidence exists on how their relational dynamics influence project quality. This study examined the effects of the client, consultant, and contractor relationship, specifically communication, meetings, and reporting, on quality assurance in road construction projects. A case study design was adopted, employing a quantitative approach, with data collected from 122 randomly selected stakeholders involved in 50 road projects under the Dar es Salaam Metropolitan Development Project. Factor analysis was conducted to validate constructs, retaining only variables with factor loadings ≥ 0.600. Multiple regression analysis revealed that communication and reporting are significant predictors of quality assurance, explaining 91.1% of the variance (R² = 0.911). Communication had the strongest effect (β = 0.475, p = 0.000), indicating that improved communication substantially enhances project quality. Reporting also showed a statistically significant positive influence (β = 0.318, p = 0.013), though to a lesser extent. These findings underscore the importance of structured communication systems and regular reporting in ensuring quality road infrastructure. The study concludes that fostering effective collaboration among clients, consultants, and contractors through enhanced communication channels and comprehensive reporting mechanisms is vital for achieving quality assurance. It recommends strengthening stakeholder coordination, institutionalising information-sharing practices, and investing in communication training and digital platforms to support sustainable infrastructure development.

Macroeconomic determinants of private investment in Kenya: An ARDL approach (1980-2023)

2026-01-26T07:46:10+00:00

Private investment is one of the main contributors to economic growth and development in both developed and developing countries. As a result of this Kenyan government in 2023 pursued several tax and regulatory reforms aimed at improving the investment climate, including removing the VAT on exported services, reimbursing verified tax refund claims within six months, and increasing credit access to the private sector. This study sought to assess the determinants of private investment in Kenya over the period from 1980-2023 to determine the key factors that may have enhanced or constrained the private investment growth. To achieve this, this study employed the Autoregressive Distributed Lag (ARDL) technique. The findings demonstrate that GDP per capita, credit to the private sector, and openness, with significant coefficients (all at 0.05 level) of 0.930, 0.229, and 0.409, respectively, have a positive effect on private investment, while external debt and real interest rate with coefficients of -0.186 and -0.143, respectively, have a negative effect on private investment in the long-run. In addition, the results show that External debt, GDP per capita, credit to the private sector, and openness, with significant coefficients as 0.147, 1.438, 0.286, and 0.325, respectively, have a positive effect on private investment while the real interest rate, with a coefficient of -0.325, hurts private investment in the short run. It is herein recommended that policies that contribute to GDP growth, improved credit to the private sector, reduced external debt, more openness, and reduced real interest rate shall boost the level of private investment in Kenya.

Influence of empathy on organisational performance in public universities, western region, Kenya: The moderating role of organisational justice

2026-01-26T07:49:27+00:00

This study sought to determine the influence of empathy on organisational performance and to establish the moderating influence of organisational justice on leadership emotional intelligence and organisational performance in public universities western region, Kenya. The research philosophy for this study was positivism, while a descriptive explanatory research design was adopted. 794 faculty members from four public institutions were the intended subjects of which 266 participated in the survey by means of a stratified random sample procedure. Primary data was gathered using questionnaires and interview schedules. Descriptive statistics and inferential statistics were used with the aid of SPSS 27. The results showed a significant influence of empathy on organisational performance (R²=0.464, P=0.000). The interaction term has a positive effect on performance, indicating that organisational justice helps improve empathy, which in turn boosts organisational performance (R²=0.707, P=0.000). The study concluded that empathy and organisational justice jointly enhance performance in public universities, with justice amplifying empathy’s influence. Universities should embed empathy in leadership training, enforce fair policies, assess staff perceptions, and develop feedback systems; the Ministry of Education should also formalise emotional intelligence and fairness standards in the university governance framework.

Customer adoption of Islamic banking in Tanzania’s dual banking system: The role of subjective norms under demographic control

2026-01-26T07:52:22+00:00

The co-existence of Islamic and conventional banking in Tanzania offers customers diverse financial services under a shared regulatory framework, yet the adoption of Islamic banking remains low. This study examines the influence of subjective norms on adoption, controlling for demographic characteristics. Grounded in the Theory of Planned Behaviour, a mixed-methods convergent design was employed, using a convergent design, where quantitative and qualitative data were collected simultaneously using a survey questionnaire containing both closed-ended and semi-structured questions. The datasets were analysed separately and integrated at the interpretation stage to complement the quantitative findings. Quantitative analysis in R included descriptive statistics, reliability checks, correlations, and hierarchical regression, while qualitative data were analysed thematically in ATLAS.ti. A total of 375 completed questionnaires were obtained from bank customers in Dar es Salaam. Findings show that subjective norms significantly explain 18.8% of variance beyond demographics. Religiosity emerged as the strongest motivator, followed by cultural support, while family and peer effects were moderate, and social position and networks were weak. Overall, subjective norms exert a moderate but significant influence, with adoption shaped by a balance between social expectations and individual autonomy. These insights underscore the importance of leveraging religiosity and Shariah compliance for Muslim customers while highlighting practical financial benefits to attract broader segments.

The dual role of microcredit: Extent, drivers, and livelihood implications of loan diversion among smallholder farmers in Morogoro Region, Tanzania

2026-01-26T07:55:22+00:00

Microcredit serves as a vital financial instrument for promoting smallholder agricultural development across sub-Saharan Africa. However, the frequent diversion of loans from their intended agricultural purposes to non-farm uses, commonly referred to as microcredit diversion, raises critical questions about its effectiveness. This study investigates the extent, patterns, and behavioural drivers of microcredit diversion among smallholder farmers in the Morogoro Region of Tanzania. Using a cross-sectional, mixed-methods design, primary data were collected from 240 randomly selected smallholder farmers. Descriptive statistics, microcredit diversion metrics and thematic analysis of qualitative responses were employed to examine utilisation patterns and the motivations underlying loan diversion. The results indicate that while microcredit remains a crucial source of financing for farm investment, covering 49.72% of average farm expenditures, an average of 35.36% of borrowed funds was diverted to non-agricultural purposes, including household consumption, education, and healthcare. This dual role of microcredit highlights its function as both a productive investment and a consumption-smoothing mechanism within resource-constrained households. Through the Rational Choice Theory, our study interprets microcredit diversion as a rational strategy by smallholder farmers to optimise overall household welfare under scarcity and competing priorities. Thus, policy implications include the need to align microcredit disbursement with agricultural cycles, integrate financial literacy and extension services, and strengthen monitoring mechanisms to minimise diversion and maximise agricultural productivity. These findings contribute to the literature on rural finance and provide actionable insights for designing microcredit programmes that better support agricultural development in Tanzania.

Effect of capital flight on real GDP growth in the East African Countries (2000-2022)

2026-01-26T07:58:06+00:00

Countries in the East African region have had high capital flight both in its absolute value and relative to the GDP. The extent to which this increased volume of capital flight in the region has impacted economic growth is not well established. This study, therefore, sought to determine the effect of capital flight on real GDP growth in the EAC countries over the period 2000-2022. The study used fixed-effect estimation method to examine the determinants of study variables. The Levin-Lin-Chu (LLC) panel unit root test was applied to examine the order of integration, where all variables were found to be stationary at the level. The Hausman test preferred fixed effects over random effects. The results showed that the capital flight, external debt, terms of trade, and investment had a significant (at 5% level) effect on real GDP growth with coefficients of -0.37, -0.18, 0.29, and 0.56. Capital flight and external debt had a negative influence, while terms of trade and investment had a positive effect. It is therefore recommended that the East African countries should, on the one hand, enhance policies that would reduce capital flight and external debt, and, on the other hand, improve the countries’ terms of trade and investment levels so as to realize real GDP growth. Future studies should consider causality tests to establish the causal direction of the relationship between economic growth and capital flight.

Influence of welfare programmes on employee commitment among county administrators in Western Region, Kenya

2026-01-26T08:01:05+00:00

This study investigated the influence of welfare programmes on employee commitment, with organisational culture as a moderating factor, among county administrators in the Western Region of Kenya. Specifically, the study examined the effects of welfare programmes on employee commitment. Additionally, it assessed the moderating role of organisational culture in these relationships. Guided by Spillover Theory, Enrichment Theory, Segmentation Theory, and Facilitation Theory, the study adopted both descriptive and correlational survey designs. Data were collected from county administrators in selected counties, e.g., Kakamega, Vihiga, Busia, and Bungoma, using semi-structured questionnaires and interview guides. The study used a census to collect data. Data were analysed using descriptive statistics (frequency, percentages, mean, and standard deviations) and inferential statistics, with Pearson’s correlation coefficient used to assess the relationships between variables. Simple and multiple linear regressions tested the significance of individual work-life balance practices, while hierarchical regression evaluated the moderating effect of organisational culture. The findings revealed that welfare programmes (B= 0.655) all had significant positive effects on employee commitment. However, when organisational culture was introduced as a moderating factor, none of these practices showed a statistically significant effect, indicating that organisation culture did not moderate the relationship between work-life balance practices and employee commitment. These results suggested that work-life balance practices were key drivers of employee commitment, but enhancing organisational culture alone was not sufficient to improve this relationship.

Challenges facing youth in leveraging social media platforms for economic transformation: Evidence from Morogoro Municipality, Tanzania

2026-01-26T08:03:25+00:00

The emergence of social media has transformed how youth communicate, interact, and participate in socio-economic activities. Beyond serving as a tool for social interaction, social media presents immense potential for youth empowerment and economic transformation, particularly in achieving Sustainable Development Goals (SDGs) 1 and 8, which focus on eradicating poverty and promoting decent employment. This study assessed the challenges facing youth in leveraging social media platforms for economic transformation in Morogoro Municipality, Tanzania. A mixed-methods approach employing a descriptive survey design was adopted. Data were collected using structured questionnaires and in-depth interviews from 196 respondents. Quantitative data were analysed using SPSS software, while qualitative data were thematically analysed. The findings revealed four key challenges constraining youth from fully exploiting social media for economic gains. Unstable internet connectivity emerged as the most critical barrier (32%), followed by the high cost of internet services (17%), lack of knowledge and skills in using social media for economic purposes (20%), and difficulty in owning essential digital devices such as smartphones and computers (31%). These limitations collectively hinder the capacity of youth to engage productively in the digital economy. The study concludes that while social media holds substantial potential for fostering youth economic empowerment, its effective utilisation is constrained by infrastructural, financial, and knowledge-based challenges. It recommends that the government and stakeholders strengthen digital infrastructure, introduce subsidised data packages, enhance digital literacy through targeted training programmes, and facilitate access to affordable devices. Additionally, integrating social media entrepreneurship education into formal curricula and establishing mentorship networks could significantly enhance youth participation in the digital economy and contribute to Tanzania’s inclusive socio-economic transformation.

Organisational culture and strategic agility in Child Protection Non-Governmental Organisations in Nairobi County, Kenya

2026-01-26T08:06:49+00:00

The purpose of this study was to investigate the effects of organisational culture on strategic agility in Child Protection NGOs in Kenya, specifically focusing on shared values, shared beliefs, and artefacts. A descriptive correlational research design was employed in this study, and a total of 180 staff in the top and middle management levels from 36 Child Protection NGOs formed the target population. Correlation analysis showed medium and positive correlation for shared values (r=0.571, p<0.05) and artefacts (r=0.556, p<0.05), and weak and positive correlation for shared beliefs (r=0.371, p<0.05). Further, multiple linear regression analysis revealed that shared values were responsible for 22% of strategic agility (R²=0.220), shared beliefs were responsible for 13.8% of strategic agility (R²=0.138), while artefacts were responsible for 30.9% of NGOs’ strategic agility (R²=0.309). Hence, culture is crucial in enhancing organisational agility and supporting organisation responsiveness in strategy orientation in Child Protection NGOs in Kenya. As a result, organisational leaders need to exhibit emotional moral intelligence and integrate spiritual beliefs while ensuring a physical workspace that supports agility by fostering flexibility, collaboration, and efficient communication.

Implementation of advanced medical devices on the performance of healthcare facilities in Kenya

2026-01-26T08:17:49+00:00

The purpose of the study was to determine the effect of implementing advanced medical devices (AMDs) on the performance of healthcare facilities in Kenya. Specifically, the research focused on understanding the effects of planning and resourcing, installation and maintenance, and utilisation of AMDs on healthcare facility performance. The target population was Level 6 hospitals in Nairobi with a sample size of 337 composed of hospital management, biomedical engineers, and medical staff, and 83% response rate. Pearson Correlation analysis revealed a positive and significant relationship between planning and resourcing of AMDs and healthcare facility performance (r = 0.785, p < 0.05), installation and maintenance of AMDs (r = 0.746, p < 0.05), and AMDs utilisation (r = 0.781, p < 0.05). Regression analysis showed a significant positive effect of planning and resourcing on performance (β = 0.304, p < 0.05), installation and maintenance (β = 0.299, p < 0.05) and AMDs utilisation (β = 0.354, p < 0.05). The study concluded that the implementation of AMDs significantly enhances healthcare performance. To maximise the benefits of AMDs, the study recommends that healthcare facilities improve resource allocation, secure adequate funding for AMDs initiatives, and provide regular training. Additionally, establishing clear utilisation protocols, streamlined maintenance processes, and engaging biomedical engineers should be prioritised.

Building a supportive entrepreneurial ecosystem for street vending: Key requirements for growth and sustainability in Dodoma, Tanzania

2026-01-26T08:20:39+00:00

Street vending is one of the oldest forms of informal business and plays a critical role in poverty reduction by creating employment opportunities, particularly for women and youth who are excluded from the formal sector due to limited education, capital constraints, and socio-economic barriers. Despite its importance, the entrepreneurial ecosystem supporting street vendors is often overlooked by governments and formal business actors. This study aims to examine and understand the essential entrepreneurial ecosystem required to support street traders in Tanzania. The study employed a mixed-methods approach, collecting both qualitative and quantitative data from street vendors, municipal officers, and business experts to assess the current entrepreneurial environment and identify areas requiring improvement. The findings indicate that street vendors operating in the informal sector require significantly more support than has been highlighted in previous studies, which largely focus on formal businesses. Key needs identified include designated business locations, access to municipal services, formal recognition, business permits, protection from harassment, access to financial services such as loans, and entrepreneurial training. The study focuses on street vendors in Tanzania, which may limit the generalizability of the findings to other countries with different regulatory and socio-economic contexts. Policymakers and municipal authorities should adopt a more positive and inclusive approach toward street vendors by fostering a supportive entrepreneurial ecosystem. Although developing such an ecosystem may require initial public investment, the long-term benefits—such as enhanced livelihoods and increased contributions to national development—are likely to outweigh the associated costs.

Factors influencing capital structure: Insights from Dar es Salaam Stock Exchange (DSE) non-financial companies

2026-01-26T08:26:01+00:00

This study examined the factors influencing the capital structure of non-financial companies listed on the Dar es Salaam Stock Exchange (DSE). Using the pecking order theory and the trade-off theory, it specifically examined how firms' liquidity, tangible assets, and profitability affect leverage. Using a cross-sectional research approach, data from 11 purposefully chosen DSE-listed non-financial companies over a 20-year period (2000–2020) were analysed using a fixed-effect panel data regression model. The findings show that leverage is significantly impacted negatively by profitability (-0.049, p <0.01). Leverage is also observed to be negatively impacted by liquidity (-0.15, P<0.05). Conversely, leverage is strongly and favourably impacted by asset tangibility (coefficient = 0.116, p<0.01). These findings indicate that the non-financial companies listed in DSE mainly use internal financing, as it fits the pecking order theory, and tangible assets allow the companies to take on more debt, as it fits the theory of trade-offs. The paper concludes that profitability is an important determinant of leverage, which contributes to firms giving preference to internal funds. Managers have been encouraged to concentrate on generating profits and to manage concrete resources strategically to maximise their capital structure.