Financial Management Practices and Turnover Growth of Micro and Small Enterprises: A Case of Uwezo Fund in Kwale County, Kenya
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Date
2018
Authors
Mogaka, Moses Ogendi
Koori, Jeremiah
Journal Title
Journal ISSN
Volume Title
Publisher
Full Length Research
Abstract
Empirical attestation, economic evidences
and industrialization practices have
established the immense contributions of
Micro and Small Enterprises (MSEs) in
developed nations and the continuous
acceleration of economic growth among
developing countries. The government of
Kenya had been increasing funding of small
enterprises through escalation of Uwezo
fund as was evidenced from annual
budgetary allocations by the national
treasury. Out of the Ksh.5.161 billion of
Uwezo Fund that had been disbursed since
the year 2013, nationally, ksh.91.6 million
of the disbursement was channelled to
Kwale County. Despite the disbursement,
the turnover growth of MSEs in Kwale
County had only been a mere 5 per cent.
This is far much less than the expected
turnover growth of 15 per cent given the
huge investments by the fund. This study
examined the effect of financial
management practices on turnover growth of
micro and small enterprises in Kwale
County, Kenya. Specifically the study draws
on financing decisions, investment
decisions, working capital management
decisions, profit distribution decisions and
how they influence turnover growth of such
MSEs. A descriptive survey method of
research was employed in conducting the
study. The study population were the 911
registered MSEs that have received a
financing facility from Uwezo Fund in
Kwale County. Stratified random sampling
was applied to choose the sample size which
translated to 270 MSEs managers.
Structured questionnaire was used to gather
data from the respondents. The data obtained
was analysed for ANOVA, regression
analysis, and descriptive statistics. SPSS
computer software was utilised in data
coding and analysis. The results indicate that
financing decisions had a moderate
significant positive correlation with turnover
growth of MSEs. Investment decisions had a
fairly strong and significant positive
correlation with turnover growth. Working
capital management had a strong positive
correlation with turnover growth of MSEs in
Kwale County while profit distribution had a
week positive correlation with turnover
growth of MSEs in Kwale County
Description
Article
Keywords
financial management practices, micro and small enterprises, Uwezo Fund, Kwale County, Kenya
Citation
Mogaka, M. O., & Koori, J. (2018). Financial management practices and turnover growth of micro and small enterprises: A case of Uwezo Fund in Kwale County, Kenya. International Academic Journal of Economics and Finance, 3(2), 44-66.