An assessment of factors that determine the listing of small to medium enterprises on the Zimbabwean alternative security market

Abstract

The inadequacy of funding for SMEs has necessitated the need to provide an alternative way of raising funds in the form of an Alternative Securities Market. An ASM enables SMEs to raise funds through the sale of equities. There is therefore need for encouraging SMEs to register on the securities market. The study was motivated by the lack of research on this phenomenon in Zimbabwe, as it sought to investigate the factors that may influence SMEs to register on the ASM. To achieve this objective, the study adopted a quantitative cross-sectional design while a survey was used as the research strategy. Data was collected from a sample size of three hundred and thirty (330) which was drawn from a population of 1876 SMEs. Factor analysis was used to identify the factors which determine the listing of SMEs on the ASM. Five factors emerged and these were factor 1 (information accessibility), factor 2 (regulatory requirements), factor 3 (corporate governance), factor 4 (SMEs support platforms) and factor 5 (SMEs Value Addition and Beneficiation Cluster).The findings from the research study indicated that information accessibility, regulatory requirements, corporate governance, SMEs support platforms and SMEs Value Addition and Beneficiation Cluster are important in determining SMEs listing on the ASM.