School of Business & Public Management
Permanent URI for this collectionhttps://repository.kcau.ac.ke/handle/123456789/43
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Item Bank size as a mediating mechanism between financial soundness and operational efficiency: evidence from Islamic banks in sub-Saharan Africa(Emerald Publishing., 2026) Njogo, Michael Njoroge.; Dallu, Abdallah Mambo.; Korir, Fiona Jepkosgei.Purpose This study examines whether bank size mediates the relationship between financial soundness and operational efficiency of Islamic banks in sub-Saharan Africa (SSA), where the sector remains small despite growing policy relevance. Design/methodology/approach Panel data from 35 Islamic banks (2010–2024) were analysed using bias-corrected Variable Returns to Scale scores from the Simar–Wilson two-stage Data Envelopment Analysis. A panel-based mediation model with two-way fixed effects was employed, with bank size (log of deposits) as the mediator. Findings Financial soundness significantly improves operational efficiency, with asset quality exerting a negative effect and earnings stability a positive effect. However, financial soundness does not significantly influence bank size, and bank size does not significantly affect efficiency once soundness is controlled for. Consequently, the mediation hypothesis is not supported, indicating that scale does not function as a transmission mechanism in SSA Islamic banking. Research limitations/implications The findings caution against consolidation-led efficiency strategies and support policy emphasis on governance, regulatory infrastructure and operational capacity building to enhance inclusive and sustainable Islamic banking development. Originality/value This study provides one of the first empirical assessments from SSA that explicitly tests the mediating role of bank size in the soundness–efficiency relationship. The findings show that scale expansion does not operate as a transmission mechanism, suggesting that scale-driven efficiency strategies may have limited applicability.Item Government funding, institutional size, and student enrolment in public TVET institutions: evidence from Nairobi Metropolitan, Kenya(African Development Finance Journal, 2025) Ondabu, Ibrahim Tirimba.; Macharia, Alice N.This article examines the influence of government funding, specifically Higher Education Loans Board (HELB) loans and capitation, on student enrolment in public Technical and Vocational Education and Training (TVET) institutions in Nairobi Metropolitan, Kenya. Using longitudinal panel data from 2019–2023 across 12 institutions, the study analyzes how institutional size moderates the relationship between funding and enrolment. Results show that HELB, capitation, and institutional size jointly explain 66.9% of the variance in enrolment rates, with all predictors exerting significant positive effects. Larger institutions benefit disproportionately due to economies of scale and stronger absorptive capacity. The findings highlight the centrality of coordinated demand- and supply-side financing models in promoting equitable access to technical education. Policy recommendations include strengthening funding frameworks, expanding capacity in smaller TVETs, and improving administrative efficiency to maximize the impact of public financing.Item Fiscal framework and economic growth of East African member countries(African Development Finance Journal, 2025) Ondabu, Ibrahim Tirimba.; Kuir, Mayen Kuir.This study examined the relationship between public debt and economic growth in EAC member states. Using a longitudinal research design and secondary data from Kenya, Uganda, Tanzania, Burundi, and Rwanda. The research uses data collected from 2014 to 2023 for countries that were members of the EAC block by the year 2023. The analysis applied the Arellano-Bover System Generalized Method of Moments (GMM) to address endogeneity and dynamic panel concerns. To ensure reliability, diagnostic tests such as the Breusch-Pagan test for heteroscedasticity, the Hausman test, and the Arellano-Bond test for serial correlation were conducted, with results evaluated at the 5% significance level. The findings show that government expenditure has a positive but statistically insignificant effect on economic growth, reflecting the limited impact of recurrent-heavy spending on productivity, tax revenue has a negative and significant effect, suggesting that high tax rates coupled with a narrow tax base reduce private investment and household consumption and also that public debt has mixed outcomes: domestic debt had a positive though insignificant effect on growth, while external debt negatively and significantly influenced growth due to high servicing costs and currency risks.Item Financial development and economic development in Africa: a systematic review on the mediating role of fintech(MDPI, 2026) Githira, Charles.; Simiyu, Christine.; Simiyu, Denis.This systematic review examines the mediating role of financial technology (FinTech) in the relationship between financial development and economic development across African economies. It draws on 34 empirical studies published between 2019 and 2026, identified through a structured search of six electronic databases, namely Scopus, ScienceDirect, JSTOR, DOAJ, SciELO, and ERIC. The search was supplemented by manual reference screening. The review synthesises evidence on how digital financial innovations, including mobile money, digital banking, and electronic payment systems, expand financial inclusion and influence economic outcomes. Grounded in Financial Intermediation Theory, Financial Development Theory, Financial Inclusion Theory, and the Technology Acceptance Model, the review provides a coherent framework for understanding FinTech as a structural mediator rather than an independent growth driver. Studies were assessed using the Mixed Methods Appraisal Tool (MMAT, 2018). The findings indicate that FinTech significantly amplifies the positive effects of financial development on economic growth, poverty reduction, and financial inclusion, though these effects are often nonlinear and context-dependent. Institutional quality, regulatory frameworks, and technological infrastructure emerge as critical moderating conditions. This review contributes to the literature by providing the first systematic synthesis that explicitly classifies included studies by their capacity to formally test mediation versus those that imply indirect mechanisms, offering a more precise account of the FinTech–financial development–economic development nexus in Africa. The findings yield targeted policy recommendations for central banks, financial regulators, commercial banks, telecommunications providers, and government policymakers.Item Agri-insurance financing and the resilience of smallholder farmers in Nakuru County, Kenya(African Development Finance Journal, 2025) Ondabu, Ibrahim Tirimba.; Abdi, Hassan Abdullahi.Agricultural insurance has increasingly become a critical tool for stabilizing smallholder farmers’ livelihoods, particularly in regions affected by climate variability and market shocks. This paper examines the influence of Agri-insurance financing on the productivity and resilience of smallholder farmers in Nakuru County. Using a descriptive quantitative design and data from 272 respondents, findings show that insurance significantly enhances productivity (β = .258, p < .001) by reducing farmers’ risk exposure, strengthening investment confidence, and promoting adoption of new technologies. Despite high awareness levels, insurance uptake remains low due to unaffordable premiums, low trust in insurers, and limited experience with claim processing. The study recommends subsidized index-based insurance, bundling insurance with credit and inputs, digital claim-processing mechanisms, and cooperative-based outreach.Item Digital finance as a catalyst for economic growth, innovation, and regulatory evolution(IDEAS, 2025) Ondabu, Ibrahim Tirimba.; Choi, Alfonce Nyambane.; Ngila, Samuel.; Rikilem, Paul L.Purpose: This study examines the impact of digital financial services on economic expansion, technological advancements, and financial regulations. It explores how digital finance drives financial inclusion, enhances access to credit, and fosters economic growth while also addressing the associated challenges. Methodology: A systematic review approach was employed to analyze existing literature on digital finance, focusing on its influence on financial innovation, transaction efficiency, and regulatory adaptation. The study synthesizes findings from academic research, industry reports, and policy papers. Findings: The study reveals that digital finance significantly enhances financial inclusion by reducing transaction costs and expanding credit access. Technologies such as artificial intelligence, blockchain, and big data analytics have revolutionized financial services, improving efficiency, security, and accessibility. However, challenges such as cybersecurity risks, fraud, and regulatory inconsistencies persist. Regulatory bodies are adopting adaptive measures, including regulatory sandboxes and central bank digital currencies, to balance innovation with consumer protection. Unique Contribution to Theory, Policy, and Practice: This study contributes to the theoretical understanding of digital finance’s role in economic transformation. It provides policy insights for governments and regulatory bodies to design frameworks that promote financial innovation while ensuring security and stability. Additionally, it offers practical guidance for financial institutions on leveraging digital technologies to enhance service delivery and economic development.Item Agricultural value chain financing and smallholder farmers’ productivity in Nakuru County, Kenya(African Development Finance Journal, 2025) Ondabu, Ibrahim Tirimba.; Abdi, Hassan Abdullahi.Agricultural Value Chain Financing (AVCF) has emerged as a critical pathway for improving the productivity and resilience of smallholder farmers across developing economies. This study examines the influence of AVCF on the productivity of smallholder farmers in Nakuru County, Kenya. Using a descriptive quantitative design and data from 272 farmers, the study demonstrates that AVCF significantly contributes to improved input accessibility, strengthened market linkages, and enhanced farmer profitability. Regression analysis confirms a positive and statistically significant relationship between AVCF and productivity (β = .166, p = .005). Despite the benefits, participation remains limited due to capacity gaps, information asymmetry, and weak extension systems. The study recommends strengthening contract farming, digitizing value chain platforms, enhancing extension services, and promoting farmer aggregation to unlock the full benefits of AVCF.Item Green financing and financial performance of commercial banks in Kenya(SSRN, 2025) Ondabu, Ibrahim Tirimba.; Oboyo, Nixon.This study examined the impact of green financing mechanisms on the financial performance of commercial banks in Kenya. A descriptive research design was applied, focusing on Tier 1 banks as key players in green finance, with secondary data obtained from Central Bank of Kenya (CBK)-assessed financial statements covering 2019–2023. Panel data regression models were employed to analyze the relationship between green financing and financial performance, while the regulatory environment was considered as a moderating variable. Robustness of the models was ensured through diagnostic tests, including the Hausman, Breusch-Pagan, multicollinearity, autocorrelation, and linearity tests. The findings revealed that green bonds, green mortgages, and carbon assets collectively influence bank performance, and that green financing significantly improves the financial performance of commercial banks. Furthermore, the regulatory environment was found to play a moderating role in strengthening this relationship, highlighting the importance of effective oversight and supportive policy frameworks. The study concludes that stronger regulatory support and targeted policy interventions are vital in enhancing banks’ participation in sustainable projects while safeguarding profitability. It recommends that regulatory bodies refine existing policies to align green financing with financial stability and that the government consider introducing stimulus packages to encourage greater investment by commercial banks in green finance. These insights add to the discourse on sustainable finance and provide practical implications for policymakers, regulators, and financial institutions seeking to balance profitability with sustainability.Item Funding climate action: a systematic review of climate finance efficiency and impact(JEFMS, 2025) Ondabu, Ibrahim Tirimba.; Wafula ,Anthony Emmanuel Wabwile.This study presents a systematic review of the efficiency and impact of climate finance, with a focus on the key funding sources, allocation patterns, and the effectiveness of current climate finance mechanisms in advancing climate mitigation goals. Climate finance has emerged as a critical component of global efforts to combat climate change, yet its efficiency and impact remain under scrutiny. The study synthesizes existing empirical literature on climate finance, examining the role of public, private, and blended finance in funding climate action. It highlights the major sources of climate finance, including bilateral and multilateral funds, as well as private sector investments, and evaluates how these funds are allocated across various regions and sectors. Additionally, the study explores the operational mechanisms of climate finance, assessing their effectiveness in mobilizing resources for climate change mitigation and adaptation. The findings reveal that while significant progress has been made in mobilizing climate finance, there are persistent challenges related to funding gaps, fragmentation, and inefficiencies in the allocation of resources. The impact of climate finance on achieving climate mitigation goals has been varied, with successes in some areas, particularly in renewable energy and forest conservation, but limited progress in others due to governance issues, lack of coordination, and weak institutional frameworks. The study calls for a more streamlined and transparent approach to climate finance, emphasizing the importance of effective governance and accountability mechanisms to enhance the efficiency of funding and maximize its impact on climate mitigation. Recommendations are provided to improve the alignment of climate finance with sustainable development objectives, address regional disparities, and overcome the barriers to large-scale private investment in climate action.Item Agricultural credit cooperatives and warehouse receipt financing as drivers of smallholder productivity in Nakuru county(Open Journal Publishing, 2025) Ondabu, Ibrahim Tirimba.; Abdi, Hassan Abdullahi .This study examines the influence of Agricultural Credit Cooperatives (ACCs) and Warehouse Receipt Financing (WRF) on smallholder farmers’ productivity in Nakuru County. Drawing on data from 272 farmers, findings show that both ACCs (β = .211, p < .001) and WRF (β = .265, p < .001) significantly enhance productivity by increasing access to affordable credit, enabling timely input acquisition, reducing distress selling, and stabilizing market participation. Descriptive results reveal strong reliance on cooperatives but limited access to certified warehouses. The study recommends strengthening cooperative governance, expanding rural warehouse infrastructure, digitizing warehouse receipts, and integrating WRF into national food reserve systems.