Influence of micro-finance institutions on growth of small and medium enterprises owned by women in Kipkelion District, Kenya
Tele, Hellen C.
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Microfinance institutions are non-governmental organizations that endeavor to alleviate poverty by offering working capital for the economically active poor. They usually operate in economies that are hindered by inflation, poor infrastructure and absence of legal regulations. Most of them offer short term range loans, voluntary savings, training and consultancy services. Rural entrepreneurship has become more of a way of life and 'engine' for economic transformation among rural poor. Access to micro finance proves the economic status of women and makes them more empowered in decision making. Micro finance is essential in promoting small businesses especially amongst women. The statement of the problem was to examine the role of SMEs in reduction of poverty and assistance of developing countries in the areas of wealth creation and improvement of living standards. The importance of SMEs in social and economic development. The purpose of the study was to establish the influence of micro-finance institutions on growth of small and medium enterprises owned by women. The objectives of the study were to determine the level at which credit schemes offered by MFIs influence growth of SMEs owned by women in Kipkelion district; to examine the extent to which business training offered by MFIs influence growth of SMEs owned by women in Kipkelion district; to assess the level at which marketing services offered by MFIs influence growth of SMEs owned by women in Kipkelion district and to investigate the extent to which saving schemes offered by MFIs influence growth of SMEs owned by women in Kipkelion district. The research design used was descriptive survey which sought to ascertain respondent's perspectives or experiences on a specified subject. The study targeted 1000 women owned SMEs in Kipkelion district. The sample size consisted of 300 SMEs randomly sampled from the population and five managers of micro finance institutions operating in Kipkelion District. The study collected both quantitative and qualitative data. The study employed both descriptive and inferential data analyses technique which enabled the study to establish essential facts, answer research questions, enabled relevant conclusions to be drawn and recommendations concerning the study to be made. In descriptive data analysis, percentages were used. Under inferential data analysis, correlation analysis was used to test the associations between the independent variables and the dependent variables. Data were presented in frequencies and tables. The study found out that majority of the SMEs were middle aged and had attained primary and secondary education as their highest level of education. The study reveals that credit scheme services have played a significant role in enabling the SMEs to obtain capital, buy land and other premises; business training has lead to a reduction in wastage, impacted on productivity and has motivated business people; Marketing services has helped SMEs to design, price, distribute and promote their products; saving scheme services provides safe custody of the SMEs revenues which has led to a reduction in thefts and loses of the SMEs. The study concludes that services offered by MFIs to SMEs have assisted them to grow in terms of profits, customers served and people employed. The study recommends that the government and other partners should facilitate training of women projects so that they are trained how to manage their businesses, SMEs should be encouraged to diversify their businesses also a comparative study to be carried out on those who have access MFIs services and those who have not access the services. The study also suggested that a comparative study on SMEs who have received services from MFIs and those who have not received MFls receives should be carried out in Kipkelion district.