Abstract:
The study sought to examine the influence of microfinance services on firm performance
of microbusinesses in the Wa Municipality. Microfinance services are the financial and
non-financial services offered by Microfinance Institutions (MFIs) and other lending
institutions to the poor and low-income earners including microcredit (m-credit), micro
insurance (m-insurance), micro-savings (m-savings), and capacity building and business
support (skills development) services. The study adopted the causal hypothesis-testing
research design using both qualitative and quantitative research approaches. The study
used a sample size of 50 microbusinesses across various sectors including food,
manufacturing, trading and garments. The principle instrument for data collection was a
semi-structured survey questionnaire. Data collected from participants were analyzed with
the aid of Microsoft Excel 2016 and Python 3.7.3 and presented with the aid of figures
and tables. The study found that microfinance services had a strong and positive influence
on firm performance of microbusinesses. The study also found that capacity building and
business support services had the most influence on firm performance of microbusinesses,
followed by microcredit services, m-savings services and then m-insurance services. The
study concluded that microfinance services had a strong and positive influence on firm
performance of microbusinesses in the Wa Municipality. Based on the findings, the study
recommended among other things that microbusinesses that pursue capital adequacy,
growth, and efficiency in operations should endeavor to access and utilize first of all,
capacity building and business support services provided by MFIs and other relevant
lending institutions. The study also recommended that MFIs should pursue continuous improvement of their services and create an environment of trust so that microbusinesses
will be motivated to patronize them.
