Determinants of Microfinance Services on Performance of Micro Enterprises in Kenya: A Case of Faulu Kenya In Trans Nzoia County

Abstract

The purpose of the study Was to analyse the determinants of microfinance services on the performance of micro enterprises in Trans Nzoia County. The study was guided by the following objectives: to determine the effect of savings facilities on micro enterprises performance in Trans Nzoia County. The study employed the following theories: Wealth multiplier theory, uniting theory of microfinance, Poverty alleviation theory and Human capital theory. The study adopted the survey research design with focus on the various groups registered by or annexed to Faulu Kenya Deposit Taking Microfinance for purposes of accessing financial services. The target area of the study was Trans-Nzoia County.. A Census survey was employed on the entire 45 groups in Transnzoia County to select 45 respondents, one leader for each group. The questionnaire was the instrument which was used to collect data. The results were presented in form of frequency tables, bar graphs and pie charts. The analytical model used was in the form of a multiple regression model. The findings of the study revealed that microfinance services had great impact on the performance of micro enterprises. The study recommended that microfinance institutions and Banks should either restructure or reinforce their operations for efficient and effective service to micro entrepreneurs. The government should come up with the best legislative measures to undertake to create an enabling environment for effective economic empowerment of her citizenry.

Keyword:  Saving Credit, Microenterprise Performance