Micro finance loans and the performance of small and medium scale enterprises in Lira Municipality, Uganda.
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Date
2011-10
Authors
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Publisher
Kampala International University, College of Economics & Management.
Abstract
This study sought to establish the extent to which Microfinance loans are
benefiting and improving the performance of Small and medium scale enterprises in Lira Municipality. The study has its background on the fact that if individual SME borrows MFIs loans and utilizes it with the view of Economic and market expansion, then their performances will improve. Microfinance Loans thus becomes a means of developing
local enterprises according to a mainstream view of the Neo-liberalism.
The main purpose of this study was to investigate the relationship between loans from microfinance institutions and the performance of small and medium scale enterprises within Lira Municipality. The findings will be used by different MFIs and other stake holders in this industry.
The literature review of this study was to examine past studies done in the areas of the derived benefits of Microfinance loans and the levels of performance of SMEs. The study adopted co relational descriptive survey study design. The data analysis was done by the use of SPSS to establish the correlation between the variables. Questionnaire was
used to collect the data from the selected respondents.
The targeted population was 1,200 respondents from Lira Municipality. The sample size was 300 of whom 270 were clients and 30 staff from MFIs. The accessible population was 278; 250 were clients and 28 staff of MFIs. The study found that MFIs loans and benefiting SMEs and Improving their performance. The study also found that there is a significant relationship between the benefits derived from MFIs loans and the performance of SMEs in Lira Municipality, where (r=O.941 and sig. 0.000 < 0.5)
The study concludes that the benefits derived from MFIs loans and the levels of performance of SMEs in Lira Municipality are correlated and MFIs loans improved the performance of SMEs. The study recommends that future studies could replicate this research and investigate the benefits of MFIs loans and the levels of performance o
SMEs in other towns. Comparison could then be made to establish whether the differences exist regarding these variable
Description
Thesis Presented to the School of Postgraduate Studies and Research, Kampala International University, Kampala, Uganda in partial fulfillment of the requirements for the degree of Master of Business Administration
Keywords
Microfinance loans performance, Small and medium scale enterprises, Lira Municipality, Uganda.