The role of Microfinance Services on the performance of small-scale enterprises in Uganda:

Abstract

This study was based on the role of microfinance services on the performance of registered small scale enterprises in Uganda . The literature available indicates that microfinance institutions have contributed to the performance of small scale enterprises but still some businesses are not doing well due to some problems. Therefore the researcher was interested to find out the role of microfinance institution on the performance of small scale businesses in Uganda. The specific objectives were ; To find out the contribution of capital provision on the performance of registered small scale enterprises. To examine the role of financial skills training on the performance of registered small scale enterprises. To examine the relationship between mobilization of savings and performance of registered small scale enterprises. The researcher used a combination of descriptive , analytical and cross sectional design. The descriptive and analytical was appropriate because data was easily analyzed using frequency counts , percentages or average derived from questionnaires and interviews. The cross sectional survey was used because it captured the state of the variables at a particular point in different areas of an organization . The findings portrayed that financial skill training had effect on performance of small scale enterprises and it was essential for the organization as well as the clients. The findings revealed that microfinance institutions greatly contributed towards performance of small scale enterprises through capital provision , mobilization of savings and financial skill training however the study show that despite the benefits, Letshego

microfinance has had problems which have retarded its consistence growth and these include , loan defaulting. From the findings, the researcher recommends that microfinance institutions should have a sound management structure and an appropriate management information system that safeguards clients’ deposits and this is important for the microfinance institutions to consider but the growth of SMEs needs to be taken into consideration also to ensure benefits to SME clients, constant growth of SMEs can improve availability of Micro financial funds and lower their costs.