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Effects of Accounts Receivable Financing Practices on Growth of SMEs in Kakamega County, Kenya

Mary Nelima LYANI Sindani
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Mary Nelima LYANI Sindani: Jomo Kenyatta University of Agriculture and Technology, Kenya

Expert Journal of Finance, 2018, vol. 6, 1-11

Abstract: Accounts receivable financing practice is the act of exchanging Accounts Receivables with money, and is defined as any type of financing which distinctly relies on AR, either as collateral or as eligibility requirement. Financing firm operations through Accounts receivables is gaining prominence world over which enables firms access finances easily. The objective of the study was to evaluate the effect of Accounts receivable financing practice on growth of SMEs in Kenya. Descriptive survey design and purposive random sampling were used. A sample size of 359 out of 5401 was used. Secondary data was obtained from Kakamega County Revenue Department, for the period under study. The assumptions which form a basis for use of the regression model were tested using homoscedasticity and autocorrelation. Ordinary Least Square method was used to determine the cause effect relationship between variables while hypothesis was tested at 5% significance level. The overall model was found to be significant with F=31.692 and p-value (0.00

Keywords: Accounts Receivable financing practices; Accounts Receivable Management; SME Growth (search for similar items in EconPapers)
JEL-codes: G32 G12 (search for similar items in EconPapers)
Date: 2018
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