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Advances in Social Sciences Research Journal – Vol. 10, No. 12
Publication Date: December 25, 2023
DOI:10.14738/assrj.1012.16049.
Milambo, F., Haabazoka, L., & Mwanaumo, E. (2023). Capital Structure and Sacco Growth: A Systematic Literature Review and Meta- Analysis. Advances in Social Sciences Research Journal, 10(12). 205-218.
Services for Science and Education – United Kingdom
Capital Structure and Sacco Growth: A Systematic Literature
Review and Meta-Analysis
Fidelity Milambo
Graduate School of Business, University of Zambia
Lubinda Haabazoka
Graduate School of Business, University of Zambia
Erastus Mwanaumo
Directorate of Research and Graduate Studies, University of Zambia
ABSTRACT
Globally, countries are paying particular attention to the potential of Savings and
Credit Cooperative Organizations (SACCOs) as one form of enterprise with a
meaningful impact on the economic empowerment of their citizens. Despite the
growth of SACCOs being sparsely distributed across various countries, the growth
of SACCOs driven by Capital Structure remains largely under-researched.
Therefore, this paper seeks to address this problem and develop new insights into
future research around SACCO growth and Capital Structure, through a systematic
literature review and meta-analysis of 17 articles, thereby problematizing the
literature reviewed. The analysis utilizes secondary data from 17 peer-reviewed
journals selected using renowned research databases including Google Scholar,
Semantic Scholar, and Base, for the period 2011 to 2021. Findings show that 70.6%
of articles were published in the last 4 between 2021 - 2018, while 29.4% were
published between 2017 – 2011. Kenya accounted for the majority of articles at
58.8%, while the rest of Africa had 17.6% of articles, Europe accounted for 17.6%
and Asia 5.9%. Financial performance was prominent at 48.4% as a major
parameter in the measurement of SACCO growth, with capital structure at 35.5%,
capital adequacy at 9.7%, and growth at 6.5%. The review found that all 17 articles
that were analyzed lacked in the area of modeling the relationship between the
study variables of capital structure and SACCO growth. A review and analysis of all
17 articles showed that none of the studies directly focused on capital structure and
its impact on SACCO growth.
Keywords: Capital Structure, SACCOs, Meta-analysis, Growth.
INTRODUCTION
Globally, there were 82,758 SACCOs, with over 404 million members a combined asset base of
US$3.6 trillion, and a penetration rate of 13.9% by the end of 2022 [1]. The global SACCO
movement is the largest organization in the world, bigger in terms of membership than the
trade union movement, economically more powerful than several Group 20 (G20) nations, and
employing many more people than all multinational companies taken together [2]. In theory,
such a potent movement should be central to the international development agenda. The
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Advances in Social Sciences Research Journal (ASSRJ) Vol. 10, Issue 12, December-2023
Services for Science and Education – United Kingdom
Sustainable Development Goals (SDGs) recognize this potential as can be noted in the adoption
of cooperative principles of self-help in its targets 1.1 and 1.2 aimed at poverty reduction, while
target 8.3 refers to the role of cooperatives in formalizing the informal sector, including
promoting financial inclusion and creating jobs [2]. Yet SACCO growth was not even across all
countries or among all SACCOs. SACCOs that grew were those that leveraged their capital
structure [3]. The choice of financing mix employed by enterprises is called capital structure,
composing financing from debt, equity, and hybrid securities that a firm uses to generate its
assets, operations, and future growth [4]. Countries that lagged often failed to recognize the
potential of SACCOs, often portraying them as models from a previous area that had served
their time. However, the extraordinary potential of SACCOs – member-owned and
democratically controlled enterprises, serving their members’ needs, and rooted in their
communities – is again proving popular as 21st-century businesses [5]. The cornerstone of the
SACCO sector is its ability for members to contribute equitably to the capital of their SACCO [6].
Researchers from various academic and business backgrounds have contributed to the
development of a significant body of knowledge around capital structure and the growth of
SACCOs. Consequently, carrying out an updated literature review related to capital structure
and the growth of SACCOs is necessary to provide a systematic analysis and enhance the
currently fragmented and quite diverse research in this research area. We present a method to
conduct a systematic literature review (SLR) and meta-analysis studies on SACCO growth
driven by capital structure. The paper is divided into three (3) parts. The next section outlines
our research methodology for detecting literature on capital structure and SACCO growth,
providing information about the selected articles, and insight into existing knowledge through
problematizing the literature. We then utilize SLR and meta-analysis to answer the research
questions. Finally, there is a conclusion – that summarizes the study, particularly its findings.
RESEARCH METHODOLOGY
According to [7], SLR is defined as a systematic, explicit, and reproducible method for
identifying, evaluating, and synthesizing the existing body of completed and recorded work
made by researchers, scholars, and practitioners. SLR allows for the collection of the most
relevant literature on a given topic, which fits the pre-specified eligibility criteria and assists in
answering formulated research questions [7]. Further, [8] argues that SLR consolidates
contributions from articles to advance the knowledge of a specific subject. Such articles are
often referred to as state-of-the-art and require great objectivity because their findings can be
generalized and replicated. It uses unambiguous and systematic procedures to minimize the
occurrence of bias during searching, identification, appraisal, synthesis, analysis, and summary
of studies. When the procedure is done properly and has minimal error, the study can provide
reliable findings and reliable conclusions that could help decision-makers and scientific
practitioners act accordingly. On the other hand, meta-analysis requires the utilization of either
descriptive or inferential statistical methods to summarize data from several studies on the
study area of interest. Meta-analysis refers to the statistically synthesized results from a series
of studies collected through a methodological procedure [9]. Originally used in medical studies,
meta-analysis has become more widespread in the field of finance and economics. A
combination of SLR and meta-analysis aids in the generation of knowledge from multiple
studies in qualitative and quantitative ways [7]. Therefore, a well-executed SLR is important in
ensuring that the review is well-planned before the actual review is undertaken. On the other
hand, meta-analysis assists in the generation of more precise estimates. To carry out an SLR
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Milambo, F., Haabazoka, L., & Mwanaumo, E. (2023). Capital Structure and Sacco Growth: A Systematic Literature Review and Meta-Analysis.
Advances in Social Sciences Research Journal, 10(12). 205-218.
URL: http://dx.doi.org/10.14738/assrj.1012.16049
and meta-analyses on capital structure and SACCO growth, we were guided by a Protocol,
Search, Appraisal, Synthesis, Analysis, and Report (PSALSAR) process adopted by [7].
Defining Research Questions
The core research questions of this paper were the following:
1) What is the state-of-the-art in capital structure and SACCO growth?
2) What SACCO growth models based on capital structure are common?
3) What are the current challenges that impair capital structure and SACCO growth
studies?
4) What is the way forward from the capital structure and SACCO growth studies
reviewed?
Selecting Databases and Other Research Sources
To have a comprehensive, reputable, and unbiased search, the following search databases were
utilized; Google Scholar, Semantic Scholar, and Base. These three (3) online databases were
selected because they are frequently used by researchers from various disciplines, to access a
comprehensive and unbiased search. Due to the evolution of technology that changes methods
for information archiving and retrieving, the publication dates were limited to 2011 up to 2021
(articles published in the past ten years), as a way of building our review ofthe recent literature.
Table 1: Search terms used and the total number of articles from each Database
Database Searching String N of Articles Date of Search
Scholar
Main terms in the title
Secondary search terms
“Capital Structure” AND “SACCO growth”
“Capital Structure, SACC growth”
6-Oct-2023
Semantic
Scholar
Main searching terms
Secondary search terms
“Capital Structure” AND “SACCO growth”
“Capital Structure, SACC growth”
8-Oct-2023
Base Main terms from title, abstract,
and keyword, Secondary search
terms.
“Capital Structure” AND “SACCO growth”
“Capital Structure, SACC growth”
8-Oct-2023
Defining Search Terms
The appraisal stage entails selected articles being evaluated in line with the objective of the
review. The study selection implied screening of the selected literature to identify relevant
papers for the review work. This process has two steps: selecting articles using the inclusion
criteria as depicted in Table 2 and a quality assessment using the following criteria:
1. Appropriately describing the review’s inclusion and exclusion criteria.
2. Ensuring that the literature search covers all relevant articles and studies on the topic.
3. Capital structure and SACCO growth were adequately described in the publications.
Table 2: Selection of literature using Inclusion and Exclusion Criteria
Criteria Decision
When pre-defined keywords as a whole or at least in the title Inclusion
Paper published in a scientific peer-reviewed journal Inclusion
Paper in English Inclusion
Papers published before 2021 Exclusion
Papers that are not primary or original work Exclusion
Duplications, gray literature, conference papers, book chapters, and editorial papers Exclusion