Financial determinants of SMEs performance. Evidence from Kenya leather industry

Arthur Benedict (), Jackline Kinya Gitonga (), Annette Serwaa Agyeman () and Baffour Tutu Kyei ()
Additional contact information
Arthur Benedict: School of Finance, Zhongnan University of Economics and Law, Wuhan, https://orcid.org/0000-0002-3562-8952
Jackline Kinya Gitonga: National Land commission, Nairobi, https://orcid.org/0000-0001-5186-4819
Annette Serwaa Agyeman: School of Finance, Zhongnan University of Economics and Law, Wuhan
Baffour Tutu Kyei: School of Finance, Zhongnan University of Economics and Law, Wuhan, https://orcid.org/0000-0002-2907-3727

Small Business International Review, 2021, vol. 5, issue 2, e389

Abstract: Small and medium-sized enterprises (SMEs) are one of the buoyant businesses in the global economy with abundant resources that have not been fully exploited. Despite several revelations on the challenges of SMEs, little to none have comprehensively captured financial factors affecting the performance of SMEs, particularly, in the Kenyan leather sector. This study explores financial factors that are affecting the performance of SMEs using the case of the leather industry sector in Kenya. The study data was collected by administering questionnaires to 300 respondents who were randomly chosen from SMEs within Kenyan leather sector. The study found that financial literacy, credit access and tax are statistically significant financial factors affecting the performances of SMEs. As a result, the study recommends that Government should increase its commitment to develop SMEs by offering favorable tax rates and tax exemptions to SMEs especially those in the leather sector of Kenya. Also, SMEs should heighten their financial literacy which will help augment their access to credit.

Keywords: SMEs; performance; taxation; financial literacy; credit access (search for similar items in EconPapers)
JEL-codes: E22 E43 E52 F21 G24 G32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:aaz:sbir01:v:5:y:2021:i:2:p:e389

DOI: 10.26784/sbir.v5i2.389

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