FINANCIAL INCLUSIVITY ENABLERS AND PERFORMANCE OF SMALL MEDIUM ENTERPRISES IN UASIN-GISHU COUNTY
Abstract
Financial inclusivity enablers play a pivotal role in shaping the performance of SMEs across various economies. These enablers encompass a range of initiatives and mechanisms aimed at expanding access to financial services and fostering inclusion among SMEs. The general objective of the study was to establish the effect of financial inclusivity enablers on performance of small medium enterprises in Uasin-Gishu county. The specific objectives included to determine the effect of digital financial services on performance of small medium enterprises in Uasin-Gishu County, to examine the effect of credit access on performance of SMEs in Uasin-Gishu County, to assess the effect of financial literacy programs on performance of SMEs in Uasin-Gishu County and to assess the effect of agent banking on performance of small medium enterprises in Uasin-Gishu County. Theories discussed include the diffusion of innovation theory, credit rationing theory, dynamic capabilities theory and institutional theory. A cross-sectional survey was used as the research design for this investigation. The study focused on SMEs in Uasin-Gishu County that are registered with the Revenue Department under a single business permit. These businesses had less than 20 employees. A stratified proportionate sample strategy was employed by the researcher. The main data was gathered using a standardized questionnaire that included closed-ended questions. Ten percent of the total sample size will be used in the pilot study. A total of 31 participants were selected at random from this pool. To put theories to the test, the study employed inferential statistics. Prior to performing regression, the study performed diagnostic tests to assess the assumptions. Pearson’s correlation results indicated that there is a positive and significant relationship between digital financial services, credit access, financial literacy programs, agent banking and performance of SMEs. Managerial recommendations included adopting digital financial services, employee training, strategic borrowing, financial literacy and utilize agent banking. Policy recommendations included to develop digital infrastructure, to improve credit access, to promote financial literacy and to expand agent banking networks.
Key Words: Digital Financial Services, Credit Access, Financial Literacy, Agent Banking
CITATION: Limo, A. C., Kithinji, M. M., & Mbithi, M. (2024). Financial inclusivity enablers and performance of Small Medium Enterprises in Uasin-Gishu County. The Strategic Journal of Business & Change Management, 11 (3), 261 – 2964. http://dx.doi.org/10.61426/sjbcm.v11i3.3023
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DOI: http://dx.doi.org/10.61426/sjbcm.v11i3.3023
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