MICRO FINANCE ACTIVITIES ON THE FINANCIAL PERFORMANCE OF YOUTH ENTERPRISE CASE STUDY IN KITUI COUNTY
Abstract
Microfinance has established itself as an integral part of financial sector emerging in the developing countries. Small and Medium youth Enterprises development specialists agree that finance can make great contribution to spur MSEs financial Performance, there is still another concern as to whether finance is the most pressing need of youth enterprise performance especially given the fact that some SMEs fail to prosper despite having adequate finance. In Kenya, there exist a knowledge gap on the role of Microfinance on the performance of youth enterprise especially those owned by the Youths. The general objective of this study was to determine effect of micro financing on the performance of youth enterprise in Kitui County in Kenya. Specifically, this study aimed to find out the effect of Lending, saving, Discounting bill of exchange and Marketing on the performance of youth enterprise in in Kitui County. The study adopted a case study research design. The study collected secondary using secondary data collection sheet for period of five years in eight constituency of Kitui County. The study employed a linear panel regression to analyze the role of micro financing on the performance of youth enterprise in Kitui County. Results of the study revealed positive and significant effect of lending, saving, discounting bills of exchange, training and firm performance of youth enterprises in Kitui County. It was concluded that there the need to transform the country from being agriculture produce-dependent to a developed and industrializing nation is apparent and is documented under the country's vision 2030. There is need for customized provision of bills and invoice discounting to aid in management of working capital and creation of liquidity among youth enterprises. There is need for youth enterprises to develop training and seminars that are aimed in development of skills that would aid in management. It was recommended that the need to educate the entrepreneurs of the need for prudent utilization of borrowed funds is very apparent. Regardless of the terms of payment and interest rates, credit when effectively managed can lead to improved enterprise performance, which in turn will enable timely repayment of the loans and sustain the enterprise operations.
Key Words: Lending, saving, Discounting bill of exchange, Marketing
CITATION: Kisilu, S. K., & Nasieku, T. (2022). Micro finance activities on the financial performance of youth enterprise case study in Kitui County. The Strategic Journal of Business & Change Management, 9 (2), 317 – 330.
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DOI: http://dx.doi.org/10.61426/sjbcm.v9i2.2267
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