Credit Financing And Performance Of Micro-Enterprises In Selected Small And Medium Businesses In Nyahuka Trading Center, Bundibugyo District

ABSTRACT

The topic of the study was credit financing and performance of micro-enterprises in selected small and medium businesses in Nyahuka Trading center, Bundibugyo district. The study was guided by three specific objectives, that included i) determining the extent of credit financing; ii) level of performance of small and medium enterprises; iii) the relationship between credit financing and performance of micro-enterprises in Nyahuka Trading center, Bundibugyo district. This research employed descriptive correlational design to describe the relationship between credit financing and performance of micro-enterprises in Nyahuka Trading center, Bundibugyo district. The findings of the study indicated that, the overall mean on extent of credit financing in Nyahuka Trading center, (1.1731) fall under low, therefore, it was unsatisfactory. This implies that the credit financing in Nyahuka Trading center is not satisfying the small and medium scale business individuals. The overall mean of 2.3742 fall under low which depicts a low performance of micro enterprises in Nyahuka Trading center, ]3undibugyo district. The findings indicated a positive significant relationship between credit financing and performance of microenterprises in Nyahuka Trading center, Bundibugyo district since the P- value (0.233) was greater than the level of significance (0.05), and the null hypothesis is accepted, and conclude that there is no significant relationship between credit financing and performance of small and medium scale enterprises in Nyahuka Trading center Bundibugyo district. Since Z-computed (0.135) was less than Z-critical (1 .96), at 0.05 level of significance, the null hypothesis was accepted and concluded that there was no statistical significance between credit financing and performance of micro-enterprises in Nyahuka Trading center Bundibugyo district. Since the t computed (1.201) was less than t-critical (2.000), at 0.05 level of significance, the null hypothesis was accepted and concluded that there is no statistical significance between credit financing and performance of micro-enterprises in Nyahuka Trading center, Bundibugyo district. It can be concluded that credit financing in Nyahuka Trading center is not satisfying the small and medium scale business individuals; there is a low performance of micro enterprises in Nyahuka Trading center, Bundibugyo district; the findings indicated a positive weak significant relationship between credit financing and performance of micro-enterprises in Nyahuka Trading center, Bundibugyo district since the P-value (0.233) was greater than the level of significance (0.05), the null hypothesis was accepted and concluded that there is no significant relationship between credit financing and performance of small and medium scale enterprises in Nyahuka Trading center Bundibugyo district. The researcher suggested that Microfinance institutions should always provide loans to small and medium businesses without collaterals; also Microfinance institutions should always make sure that the small and medium business owners are comfortable with the period in which should have to repay the loan; small and medium business owners should always make sure that the type of loans they get have loan installments which are manageable within the repayment period; also to small and medium business owners they should always make sure that the type of loans they get have interest rates which do not threaten the growth of their businesses. The small and medium business owners shouldn’t miss the loan repayment date in order to avoid additional charges.