Evaluation of access to finance, market and viability of small and medium-sized enterprises in South Africa

Msomi, Thabiso Sthembiso; Olarewaju, Odunayo Magret

doi:10.21511/ppm.19(1).2021.24

Cited by 21 publications

(22 citation statements)

References 20 publications

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“…Hambatan dalam penyaluran bantuan terkait akses yang ditemui dalam studi kasus ini telah terlebih dahulu ditemukan oleh Msomi & Olarewaju (2021) yang menemukan akses keuangan adalah tantangan utama yang dihadapi oleh UKM di Afrika Selatan dan merekomendasikan bahwa bantuan Pemerintah kepada UKM harus diberikan dengan peryaratan yang lunak dalam rangka mendorong pertumbuhan ekonomi.…”

Section: Prasyarat Penyaluran Sulitunclassified

Studi Kasus Intervensi Pemerintah Bagi Usaha Mikro, Kecil, Dan Menengah Di Masa Pandemi Covid-19

Harjowiryono¹,

Siallagan²

2021

ITRev

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This study investigates the impact of the COVID-19 pandemic on MSMEs and how Government intervention affects their capacity to survive. Through a survey of 368 respondents, namely debtors/beneficiaries, aid distributors, policymakers, and supervisors, this case study finds that the COVID-19 pandemic has resulted in business delays. The finding means that the government assistance schemes are the key to business continuity for MSMEs during the COVID-19 pandemic. With the help from the Government, the business actors in the sample of this study can maintain their business. Although some MSMEs reduced the number of workers employed, some MSMEs still survived, even increased their workers and business turnover. While the research identifies key success factors of Government programs, there are also some challenges in their implementation. This study recommends that the Government continues giving assistance programs for MSMEs. In addition, the Government should relax requirements while focusing on new beneficiaries. Building an integrated MSME database is also necessary, and in the future, the Government must integrate the assistance program with financial literacy and innovation programs. The policy implication of this research is that the future programs of government poverty alleviation need to focus on MSMEs.

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Section: Prasyarat Penyaluran Sulitunclassified

Studi Kasus Intervensi Pemerintah Bagi Usaha Mikro, Kecil, Dan Menengah Di Masa Pandemi Covid-19

Harjowiryono¹,

Siallagan²

2021

ITRev

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“…Small and medium-sized enterprises operating within the Central Business area of Durban, KwaZulu-Natal, South Africa were surveyed to collect data for the evaluation of the financial awareness, access to digital fihttp://dx.doi.org/10.21511/imfi.20 (1).2023. 27 nances and SME sustainability in South Africa. In all, 103 questionnaires were distributed and collected from participants throughout the retail, industrial, agricultural, and construction industries.…”

Section: Methodsmentioning

confidence: 99%

“…http://dx.doi.org/10.21511/imfi.20 (1).2023. 27 Access and awareness to digital platform is fundamental to moderate the financial costs and develop financial productivity and sustain SMEs financially (Fan e al., 2022). Although the use of digital platform worldwide is improving, financial systems usage by businesses managers is still very low in many developing countries compared to developed countries.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Consequently, numerous constraints face this sector that impede its productivity and growth, among those are lack of access to digital platforms as well as poor financial awareness which subsequently threats the sustainability of SMEs (Msomi & Olarewaju, 2022). However, many studies found that having access to cash has a substantial influence on the sustainability of a firm, and that having a solid understanding of digital platforms is necessary to get funding as the impact of financial awareness on the efficiency with which SMEs are managed is both beneficial and significant (Hussain et al, 2018;Abdulaali et al, 2019;Tuffour et al, 2022;Msomi, Yearwood & Msomi, 2022). As a result, access to digital…”

Section: Introductionmentioning

confidence: 99%

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Sustaining small and medium-sized enterprises through financial awareness, access to digital finance in South Africa

Msomi

Kandolo

2023

Investment Management and Financial Innovations

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Small and medium-sized enterprises (SMEs) have several critical challenges that threaten their capacity to survive and thrive. However, access and awareness to digital platform is fundamental to moderate the financial costs and develop financial productivity and sustain SMEs financially. Considering this, the purpose of this study is to get empirical information on the level of management awareness and usage of digital platforms in SMEs in South Africa. The methodological framework included a quantitative research strategy and positivist paradigm. Purposive sampling was utilized to collect data from 321 out of 700 SMEs owners, and the Cochran formula was used to explain the sample size. There were 321 surveys sent out, and 304 were filled out and returned (95% response rate). Descriptive analysis, Pearson’s correlation, and regression analyses from the Statistical Package for Social Sciences were used. The results of Pearson’s correlation coefficient establish a statistically significant relationship between access to digital finances and SME Sustainability (r = 0.334), as well as a statistically significant relationship between financial awareness and SME Sustainability (r = 0.549). The findings alert SMEs managers of the need to improve their digital platforms awareness in order to meet current financial demands and make better informed financial choices to improve company success. The results explain the advantages of trading using many digital platforms available in the country to improve the performance of their enterprises.

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“…Therefore, higher competitiveness in banking markets may positively affect firms' need for bank loans, encouraging firms to apply for a loan (Leon, 2015; Ayalew and Xianzhi, 2019). A banking sector with increased market power generally charges higher interest rates, which was perceived as an obstacle discouraging firms from applying for a bank loan (Msomi and Olarewaju, 2021). In India, WBES (2014) reports that despite having a credit need, around 62% of firms did not apply for a loan or line of credit because they were discouraged due to higher interest rates.…”

Section: Theoretical Arguments and Hypotheses Developmentmentioning

confidence: 99%

Bank competition and SMEs access to finance in India: evidence from World Bank Enterprise Survey

Rakshit

Bardhan

2023

ARA

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PurposeThe primary purpose of this study is to investigate the effects of bank competition on SMEs' access to finance in selected Indian states. Using 9,281 firm-level observations from World Bank Enterprises Survey (WBES), this study tests the market power hypothesis versus the information hypothesis to determine whether bank competition promotes access to finance for financially constrained firms.Design/methodology/approachThe authors measure state-level bank competition using two structural indicators: the Herfindahl Hirschman Index (HHI) and three bank concentration ratios (CR3). The authors apply simple probit regression, probit model with sample selection (PSS) and two-stage least squares (2SLS) to examine the effects of bank competition on firms' financing constraints.FindingsThe results obtained through PSS and 2SLS indicate that bank competition alleviates firm's financing constraints and positively impacts its need for a bank loan and the decision to apply for bank credit. However, the prevalence of bank competition in promoting access to finance is more pronounced for small and medium-sized firms than for large firms. Higher bank competition also alleviates the credit constraints faced by female entrepreneurs.Practical implicationsReserve Bank of India (RBI) and other government stakeholders should ensure bank competition without hampering the agenda of bank consolidation to facilitate access to credit for SMEs. Regulators should also identify and monitor the financial institutions that make an insignificant contribution to promoting competitiveness in the financial system.Originality/valuePrevious studies primarily investigate the effect of bank competition on a firm's access to finance from advanced and cross-country perspectives. This study contributes to the literature on bank competition by examining its role in promoting access to finance from an emerging economy standpoint. Measurement of bank competition indicators at the state level is an additional contribution.

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Evaluation of access to finance, market and viability of small and medium-sized enterprises in South Africa

Cited by 21 publications

References 20 publications

Studi Kasus Intervensi Pemerintah Bagi Usaha Mikro, Kecil, Dan Menengah Di Masa Pandemi Covid-19

Studi Kasus Intervensi Pemerintah Bagi Usaha Mikro, Kecil, Dan Menengah Di Masa Pandemi Covid-19

Sustaining small and medium-sized enterprises through financial awareness, access to digital finance in South Africa

Bank competition and SMEs access to finance in India: evidence from World Bank Enterprise Survey

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