Effects of Non-Financial Services of the Micro Financing Institutions on Performance of Entrepreneurship: A Study of Selected Counties in Western Kenya

Abstract

Effects of Non-Financial Services of the Micro Financing Institutions on Performance of Entrepreneurship: A Study ofSelected Counties in Western Kenya IntroductionUnited Nations 2030 Agenda, identified Micro and Small Enterprises (MSEs)as critical in achieving the Sustainable Development and its Goals, at regional levels, MSEs plays and will continue playing an important role in increasing intraregional and interregional trade as envisaged in the regional economic blocs, especially the recently launched African Continental Free Trade Area (International Trade Centre, 2019). While in Kenya Vision 2030, the long-term development blueprint that seeks to transform Kenya into a newly industrialized, high middle-income country, recognizes the key role of micro, small and medium-sized enterprises (MSMEs) in attaining its goals (GOK, 2007). The Micro and Small Enterprise Act 2012 (MSE Act 2012) Laws of Kenya define Micro Enterprises as having annual turnover of less than Ksh 500,000, and employ up to ten employees, while Small Enterprises are those with Annual Turnover of between Ksh 0.5million and Ksh5million and employs between ten to fifty employees (GOK, 2012).Micro, Small and Medium Enterprises (MSMEs) are very important to employment creation, poverty alleviation and sustainable economic development of developing countries (Mwaanga, 2014). SMEs employ more than 80% of the working population in Kenya and play a central role in its economic and growth strategies. Efforts to make MSEs more competitive can help the country achieve its development objectives by creating more jobs, strengthening sectors and developing business models that work. Policy and business reforms that include developing the trade support ecosystem and capacity building at the firm level aim to help Kenyan MSEs become more competitive -nationally, regionally and globally (ITC, 2019).