An assessment of the impact of microfinances on poverty and economic perfomance of small and medium enterprises. [case of JHM Microfinance in Mutoko District]
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The aim of this study was to find out the impact of Microfinance institutions (MFIs) on poverty reduction and Economic performance of Small and Medium Enterprises (SMEs). The research was carried out in Mutoko District in Zimbabwe. The research targeted one Microfinance (Jhm Microfinance).Systematic simple Random sampling to select members of the MFI under study and 30 small and medium-enterprises were selected. Primary data was collected using questionnaires and presented by Descriptive statistics methods pie charts and tables. Data was pre-coded and analyzed using Microsoft excel. The research found that Microfinance services have a positive effect on poverty reduction and economic performance of SMEs in Mutoko District. The findings showed that Microfinance has a strong impact on improving the living standards of the clients. The research recommends that MFIs should work hand in glove with the government to ensure rapid economic growth and improve the social wellbeing of the beneficiaries. In addition MFIs are recommended to employ skilled labor force that have knowledge in financial management and risk management so that customers will acquire knowledge through trainings offered by the skilled MFIs workforce. This is based on the notion that entrepreneurship skills improves their businesses that will lead to higher income from their businesses thereby escaping from poverty in Zimbabwe.