Mobile Credit and Performance: Experience and Lessons from Micro and Small Enterprises in Kenya
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Date
2021
Authors
Alumasa, Silas
Muathe, Stephen
Journal Title
Journal ISSN
Volume Title
Publisher
Scientific Press International Limited
Abstract
Micro and small enterprises sector is considered as very important in growing the
economies of many countries, especially the developing nations. In Kenya, the
Micro and small enterprises sector is an important contributor to the growth of the
economy through facilitation of trade and creation of employment. While various
interventions have been made to grow this sector, the enterprises have continued to
perform poorly, struggle to survive and a large number die off. This study sought to
investigate the effect of mobile credit on performance of micro and small
enterprises. The study was to determine the effect of accessibility, the effect of the
cost, the effect of mobile credit loan amount and the effect of regulation on
performance of micro and small enterprises. The study was anchored on various
theories of Resource based view, Dynamic capabilities, Diffusion of technology,
Credit rationing, and the asymmetry of information. The study found out that the
accessibility of mobile credit, the Loan amount and the regulation have significant
positive effect on performance, while the cost of mobile credit has a significate
negative effect on the performance of micro and small enterprises. The study
concluded that mobile credit is an essential source of credit to micro and small
enterprises.
Description
An Article Published in Journal of Applied Finance & Banking
Keywords
Mobile credit, Micro and small enterprises, Performance, Resource based view, Dynamic capabilities theory