Factors Affecting Uptake of Formal Financial Services by Small and Medium Entrepreneurs Inkajiado County, Kenya

Author(s)

Florence Ndunge Mutua , Dr. Charles W. Weda ,

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Volume 6 - August 2017 (08)

Abstract

The main purpose of the paper was to determine factors that affect uptake of formal financial services by small and medium entrepreneurs in Kajiado County. The study adopted descriptive survey design and used both quantitative and qualitative techniques. Target population for the study was 2,795, small and medium entrepreneurs registered in the five sub-counties within Kajiado County. Sample size was arrived at through stratified and simple random techniques. From the target population of 2,795, a sample size of 280 was used for the study. Primary data was collected through questionnaires and structured interviews. From the questionnaires administered 252 were completed culminating into 90% response rate. Data collected was analyzed using Correlation and Multiple Regression Analysis and presented using frequency tables. The Statistical Package for Social Sciences (SPSS) was used for analysis. The study found out that among the four variables studied, that is; collateral requirement and level of financial literacy are the main factor that hindered the uptake of the formal financial services by the SME’s in Kajiado county. The study was of importance to county governments and financial institutions in Kenya in understanding the factors affecting the uptake of formal financial services by small and medium entrepreneurs. It was also of great help to county potential investors in making informed decisions of whether or not to invest in the counties. The study was also of great help to other researchers who hope to increase the body of knowledge in this important field of formal financial services.

Keywords

Collateral Requirement, Level Of Financial Literacy, Uptake Of The Formal Financial Services And Small And Medium Entrepreneurs

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