Effect of Micro-finance on Financial Performance of Small and Medium Enterprises in Kwale County, Kenya

Abstract

The study looked to analyze the impact of micro-finance on monetary execution of little and medium endeavors in Kwale County. The targets of the study were: to decide the impact of miniature preparing on monetary execution of SME in Kwale County; to decide the impact of miniature credit on monetary execution of SME in Kwale County; to decide the impact of miniature saving money on monetary execution of SME in Kwale County and to decide the impact of miniature protection on monetary execution of SME in Kwale County. The study was additionally directed by 3 hypotheses specifically, hierarchy hypothesis, asset based hypothesis and dynamic compromise hypothesis. The study embraced a graphic exploration plan, an objective populace of 813 SME administrators in Kwale County, concentrate on example was acquired utilizing Yamane's examining recipe subsequently 274 SME chiefs were occupied with this study. Examination information was gathered utilizing essential and auxiliary apparatuses. Essential examination instruments were tried for legitimacy and unwavering quality before investigation and show of discoveries. Information was dissected utilizing expressive and inferential measurements utilizing SPSS and introduced in tables and diagrams. Study discoveries set up a positive connection between miniature credit, miniature preparing, miniature protection and miniature reserve funds and monetary execution of Small and Medium ventures in Kwale County. It was hence reasoned that; microfinance emphatically impact the monetary exhibition of little and medium undertakings in Kwale County. The study suggested for preparing of SME managers on the various loans offered by microfinance so that they can choose wisely based on the need and ability to repay to discourage loan defaults. The study also recommended for continuity of training to ensure that SME managers are able to carry their businesses through all business cycles, it was noted that training services are offered only when a customer seeks credit. Furthermore, microfinance managers should also encourage SME to save more with them so that they can be liquid and buy shares in the financial institutions and discourage savings as a basis of acquiring a loan. Lastly, microfinance managers should educate their customers on the importance of insurance into their businesses, during the study many respondents indicated that they take insurance but see it as a liability as they do not claim funds contributed