• English
    • français
  • English 
    • English
    • français
  • Login
View Item 
  •   Repository Home
  • Research Papers (RP)
  • RP-School of Economics
  • RP-Department of Applied Economics
  • View Item
  •   Repository Home
  • Research Papers (RP)
  • RP-School of Economics
  • RP-Department of Applied Economics
  • View Item
JavaScript is disabled for your browser. Some features of this site may not work without it.

Effects of participation of micro and small enterprises in microfinance on their performance in Kenya

Thumbnail
View/Open
Full Text Article (1.062Mb)
Date
2018-06-05
Author
Obebo, Forah M.
Wawire, Nelson H.W.
Muniu, Joseph M.
Metadata
Show full item record
Abstract
The development of the microfinance sub-sector in Kenya is seen as a favourable catalyst for increasing performance of Micro and Small Enterprises (MSEs). Despite the development, MSEs continue to suffer from high levels of financial exclusion and shortage of operating funds. This scenarios raise policy questions on whether participation in microfinance has effects on performance of MSEs. While past studies on this relationship have demonstrated that the effects are mixed, an understanding of the effects on participation of microfinance on different segments on MSEs -especially the youth and women owned businesses and age of businesses, is necessary in designing relevant policy changes in the MSE subsector. To address this, the study used the 2016 FinAccess Dataset and estimated these effects using the propensity score matching technique. This model was considered suitable since it accounted for potential endogeneity biases associated with self-selection into participation, unobserved entrepreneurial abilities and risk taking behaviour of MSEs. Apart from showing that participation in microfinance has positive effects on performance of MSEs, the study has demonstrated that there is presence of constraints limiting the impact of microfinance especially in firms owned by the youth and women. As such, there is need for policy and product designs to address these hindrances even as participation in microfinance is encouraged. Based on the results, it is recommended that government and microfinance providers should design policies and products that increase firm participation in microfinance. This may be through scaling up financial literacy programmes and encouraging acquisition of permits. Finally, policy should address obstacles that hinder the youth and women owned MSEs from benefiting from microfinance.
URI
http://ir-library.ku.ac.ke/handle/123456789/19476
Collections
  • RP-Department of Applied Economics [102]

Designed by Library ICT Team copyright © 2017 
Contact Us | Send Feedback

 

 

Browse

All of RepositoryCommunities & CollectionsBy Issue DateAuthorsTitlesSubjectsThis CollectionBy Issue DateAuthorsTitlesSubjects

My Account

LoginRegister

Designed by Library ICT Team copyright © 2017 
Contact Us | Send Feedback