Financial Services Access and Financial Performance of Sme’s Case Study: Wandegeya Parish Area C

Abstract

The Research is carried out on Financial services access and the Financial performance of Small and Medium Enterprises (SMEs) aimed at assessing the effect of lending services to the financial performance of SMEs, analyzing the effect of credit insurance services to the financial performance of SMEs and to establish the effect of savings services to the financial performance of SMEs.

The study adopted the quantitative method of the study; it was a case study design focused on testing the effect of financial service access and financial performance of SMEs, questionnaires was the main data collection tool used research was analyzed using tables and SPSS, Regression analysis was used to find the relationship between the two variables

The researcher realized that Credit insurance service affect financial performance of SMEs that is an increase in credit insurance service would lead to a significant increase in financial performance of SMEs Majority of the SMEs practice savings and find it easy to deposit and withdraw from financial institutions There is a significant relationship between Lending services, insurance services and savings service and financial Performance of SMEs these Financial services will increase on capital and investment levels hence improved Financial Performance.

Financial services in the dimensions of lending services, insurance services and saving services have a positive and significant relationship with financial performance of SMEs that is a change in any of the dimensions leads to a significant change in financial performance of SMEs. This means that the given dimensions should be taken serious by the SMEs to ensure good financial performance.

The government must come in provide soft loans to these SMEs, regulate the interest rates through the central bank to enhance investment, provide public infrastructure like roads, electric power so as to facilitate SMEs investment.

SME owners should endeavor to insure the businesses to reduce on risks of trade debt default avoid disastrous losses and grow their business profitably. The findings indicate that majority of the SMEs save with Financial institutions while there those who do not save with Financial institutions but save in many different ways such as with friends and in boxes.

SMEs should endeavor to save with financial Institutions to be able to improve their saving potential and be able to enjoy the benefits of savings as seen in the reviewed literature.

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