Impact of microfinance institutions in inclusive financing of small to medium businesses (case study of Harare City).
Moyo, Tatenda, G.
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This study examined the impact of microfinance institution in inclusive financing of small to medium enterprises in the Harare Central Business District. Studies have been done in Zimbabwe on SMEs and how they are influenced by microfinance services but none had focused on the effects of financial micro finance services on financial inclusion. The specific objectives of the study were to find out the bulk of loans that are approved by MFI to SMEs and to find out if MFIs foster financial inclusion to SMEs and women. A quantitative descriptive design was used to study 7 types of businesses in Harare. Structured questionnaire was used to collect data from a sample of 500 businesses from a list of 3320 was taken as a representative population in the city. The study was on independent and dependent relationship. Microfinance and training contribute positively on SMEs growth. Data was collected using questionnaires and documentary reviews. The research indicated that MFIs have a positive effect on the development and growth of SMEs. Some of the critical positive contributions of MFI included greater access to credit, savings enhancement and provisions of business in financial and management training. The outcome reviewed that most of the respondents who were engaged in micro enterprises were female which proves the financial inclusivity. Recommendations of the study are that clients be trained in financial literacy so as to make informed decisions and also that owners of business should make a proper use of loans that they would have acquired them for and not for other means.