MICRO-CREDIT FINANCING AND SUSTAINABILITY OF MICRO AGRO ENTERPRISES IN KENYA: A CASE OF MACHAKOS COUNTY

Abstract

The study purpose was to establish the effect of microcredit on micro agro enterprises and how they contribute to the sustainability of the micro agro businesses in Machakos. One key obstacle to growth and sustainability of micro agro enterprises is inaccessibility of micro credit and micro capital to start and sustain micro enterprises and other small micro and micro businesses. The study employed descriptive research design. The study was anchored on Game Theory of Microfinanceand Social Capital Theory. Stratified sampling that is random was adopted to select the study sample size of 129 micro agro enterprises. Data collection was done using a semi structured questionnaire. The analysis of the quantitative data involved both descriptive and inferential statistics. Correlation analysis of the study finding showed that there is a significant and positive association between table banking credit and sustainability of micro agro enterprises. Regression results showed that table banking credit has a strong positive relationship with sustainability of micro agro enterprises. The study also established that there is a significant and positive association between joint loans board credit and sustainability of micro agro enterprises. Regression analysis indicated that Joint Loan Boards have a strong positive relationship with sustainability of micro agro enterprises. The researcher findings further showed there is a positive and significant relationship between credit from Saving and Credit Cooperative Organizations and sustainability of micro agro. Regression analysis indicated that micro credit from Saving and Credit Cooperative Organizations have a strong positive relationship with sustainability of micro agro enterprises. Finally, correlation analysis showed that there is a positive and significant association between credit from MFIs and sustainability of micro agro credit. Regression analysis indicated that credit from MFIs have a strong positive relationship with sustainability of micro agro enterprises.