Abstract:
The objective of the study is to establish the effect of mobile payments on the financial performance of SMEs
in Kirinyaga County. The study was based on the Diffusion of Innovation theory. This study employed a
descriptive study design. The targeted population was the 226 SMEs recorded by ministry of finance and
revenue, revenue department, of Kirinyaga County as having renewed their licenses for 5 consecutive years.
The sample size was 160 respondents, which were arrived at with the aid of the Yamane formula. Cluster
sampling technique was used based on the fact that the data was collected from different towns within the
same county; hence, there was equal geographical representation among the different towns within
Kirinyaga County. Mixed questionnaires were used to collect primary data for the study. The questionnaires
were administered through Google forms, filled and submitted through the same platform. Prior to giving out
the questionnaires in the field to SME owners, a pre-test of 10 SME owners in Tharaka Nithi County was
conducted to ensure that the questionnaire is reliable and valid. Some judgmental techniques tested the
validity, followed by a second review from the experts to guarantee content validity. Raw data from the
questionnaires was cleaned, coded and analyzed using SPSS V29. Descriptive statistics was used to
summarize the findings by use of percentages, standard deviations frequencies and means, while inferential
statistics used the Karl Pearson to establish how mobile banking affects the financial performance of SMEs in
Kirinyaga County. The findings indicated that mobile payments have a significant and positive effect on the
financial performance of SMEs in Kirinyaga County. The study recommended that in order to help SMEs
increase cash flow management, reduce operational costs, and access capital for expanding their businesses,
SMEs should adopt a holistic mobile payments services.
