Financial Constraints to SMME Growth: Investigating the Moderating Effect of Microfinance

Nasraldin Omer (), Ricardo M. Peters () and Kobus Visser ()
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Nasraldin Omer: Sudan University of Science and Technology
Ricardo M. Peters: University of the Western Cape
Kobus Visser: University of the Western Cape

No 18, Proceedings of the 7th International RAIS Conference, February 19-20, 2018 from Research Association for Interdisciplinary Studies

Abstract: Small, Medium and Micro Enterprises (SMME) play a significant role in an economy. SMMEs are an important source of jobs, entrepreneurial spirit and innovation. However, despite the noted contribution of SMMEs, in many countries they face serious constraints, often resulting in failure. The constraints and economic environment have significant and unequal effects on SMMEs in different industries and in different locations. Constraints have been used, amongst other growth factors, to understand why some SMMEs fail to grow. The aims of this study was to examine the effect of financial constraints on SMME growth and to investigate the moderating effect of microfinance on overcoming, avoiding or mitigating the financial constraints to SMME growth. The study found evidence that the lack of professional financial advisors, lack of access to finance and lack of awareness of financial services and assistance were significant constraints to SMME growth in South Africa.

Keywords: SMME growth; financial constraints; microfinance; moderating effect; South Africa (search for similar items in EconPapers)
Pages: 2 pages
Date: 2018-03
New Economics Papers: this item is included in nep-mfd and nep-sbm
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Published in Proceedings of the 7th International RAIS Conference on Social Sciences, February 19-20, 2018, pages 236-237

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Persistent link: https://EconPapers.repec.org/RePEc:smo:fpaper:018

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