College of Business and Economics

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    DETERMINANT FACTORS OF SUCCESS OF SAVING AND CREDIT COOPERATIVES IN TIGRAY
    (Mekelle University, 2025-11-25) TESFAHUNEGN GUESH ABAY
    Savings and Credit Cooperative Organizations (SACCOs) are key to promoting financial inclusion and socio-economic growth, particularly in regions with low exposure to formal banking. While SACCOs are registered in the Tigray region of Ethiopia, most of them fail to achieve sustainable success. This study assesses the determinants of the success of SACCOs in Tigray, with a specific emphasis on governance, technological adoption, and financial management practices. The study adopted a cross-sectional research design, and quantitative data were collected using a structured questionnaire from 257 officers, managers, and board members of selected urban SACCOs. Descriptive statistics and binary logistic regression were used to analyze data and determine factors that were significantly linked with SACCO success as measured by loan repayment rates, membership growth, and savings mobilization. The findings indicate that SACCOs in Tigray are staffed by a highly educated workforce, implying high human capital potential. The regression model identified four statistically significant determinants of success: Work experience (AOR = 00.211, p<0.030), Governance Effectiveness (AOR = 0.115, p < 0.001), the Impact of Technology Adoption (p = 0.002), and Dividend Payment (AOR = 5.430, p = 0.022). SACCOs with very strong governance, experienced employees, and those that paid dividends were significantly more likely to be successful, while a moderate (as opposed to high) technological impact was negatively associated with success. Operationally, speedy loan processing was the principal membership growth driver, overshadowing traditional drivers like low-interest rates. A fundamental "governance paradox" was observed, whereby formal arrangements like regular board meetings exist alongside a grave deficiency in board member training. The study concludes that SACCO success in Tigray is multifaceted, premised on the effective alignment of robust governance, deep (not moderate) technological integration, and strategic financial practices like dividend distribution. It recommends that SACCOs invest in board capacity through continuous training, in core banking and mobile technologies, and formalize financial strategies. Policy recommendations are that policymakers establish a tiered regulatory framework and facilitate technology adoption. This research provides valuable empirical lessons for enhancing SACCO performance and sustainability in Tigray and similar settings.
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    Factors Affecting Growth of Micro and Small Enterprises: The Case of Enticho Town
    (Mekelle University, 2025-11-25) Etenesh Yeabyo
    This study examines the internal and external determinants influencing the growth and sustainability of Micro and Small Enterprises (MSEs) in Enticho Town, Tigray, Ethiopia. Although MSEs play a central role in job creation, income generation, and structural transformation, their growth remains constrained by multiple financial, infrastructural, and institutional factors. Using quantitative cross-sectional research design, primary data was collected from 155 MSE operators across manufacturing, trade, service, construction, and urban agriculture sectors. The data were analyzed using descriptive statistics, correlation analysis, and multiple linear regression to identify the most significant predictors of enterprise growth. The findings reveal that infrastructure quality, workplace conditions, internal managerial capacity, and marketing capability are key positive contributors to MSE growth. Financial constraints and governance related challenges, including complex regulations, taxation burdens, and administrative inefficiencies negatively affect performance and limit expansion. The regression model explained a substantial proportion of the variation in MSE growth, underscoring the combined effect of internal competencies and external enabling conditions. The study concludes that sustainable MSE development requires integrated interventions that address financial access, infrastructure, capacity building, and institutional reforms. Improving access to credit, investing in enabling infrastructure, strengthening entrepreneurial and managerial skills, and enhancing transparent governance are essential for fostering a supportive business ecosystem. The findings provide important insights for policymakers, local administrators, development partners, and practitioners involved in promoting inclusive economic growth.