Microfinance Services and the Performance of Small and Medium Enterprises Case Study: a Case Study of Katwe Small Scale Industries Development Association (Kassida) in Kampala Central Division Kampala District
Year: 2017
Author: KISAKYE REAGAN
Supervisor: Edward Ssemwogerere Anselm
Abstract
The study was about micro-finance services and performance of small and medium enterprises in KASSIDA. Given the role played by Micro-finance Services in the performance of SMEs in Uganda, delivery of Micro-finance services remains poor, growth of SMEs have continued to decline for several factors like high interest rates on loans.
The study was guided by three set objectives: To find out the relationship between Micro credit services and the performance of Small and Medium Enterprises. To compare the relationship between Micro deposit services and the performance of Small and Medium Enterprises. To determine the relationship between Money transfer services and the performance of Small and Medium Enterprises. Purpose of the study was to examine whether micro-finance services have a significant effect on the performance of SMEs in KASSIDA Organization and also to find out the Micro-finance services used by Microfinance Institutions.
The methods used in obtaining primary data included: self-administered questionnaire, interviews aided by interview guide, secondary data was also used and obtained through secondary data sources; Reports, Education journal, Text books among others. Descriptive data analysis was used to analyze data obtained from the field.
Major services provided by MFIs were micro-credit services (loan provision), micro deposit services and money transfer services. The services were highly accessible but service delivery by MFIs was poor. Small enterprises experienced high growth rate contrary to medium enterprises, micro-finance services contributed to growth of SMEs. There was a significant relationship between micro-finance services and performance of SMEs.
MFIs provided mostly micro-credit services and savings, micro-finance services provided for the performance of SMEs, micro-finance services had a strong positive relationship with performance of SMEs. Improving and enhancing the effectiveness of service delivery by MFIs, need to promote balanced growth rate between Small and medium enterprises, enhance strong linkages between growth of SMEs and service delivery.
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