An investigation on the impact of access to sources of finance on the growth of small and medium Enterprises (SMEs) in Zimbabwe

Abstract

This research focused on the impact of access to finance and growth of small and medium enterprises, a case study of SMEs in the manufacturing industry in Zimbabwe. The researcher reviewed literature on the sources of funding available to SMEs in Zimbabwe, importance of access to funding on SMEs growth and lastly, challenges faced by SMEs in accessing funding and there was recorded as general consensus indicating that availability of funding to SMEs operations and activities can lead to SMEs growth. Primary research findings also gathered that access to funding positively promote growth for SMEs operations in the long term. In support, Coleman (2002) and Oaya et al (2007) positively stated that financial resource is the lifeblood of every organisation as it accelerates the smooth flow of operations. No SMEs is capable to fully fund its operations sustainably without external funding and as such finance houses are encouraged to promote and financially support SMEs operations and activities so that they grow to become bigger organisations. With a careful consideration of secondary and primary research findings, the researcher depicted practical conclusions. The researcher adopted exploratory and descriptive research designs for this particular project. 268 sampling units consisting of SMEs owners, managers and employees based in Harare were used for the research. Self-administered questionnaires were used to collect data from 268 respondents and 249 units were the valid recorded questionnaire which produced these results. Convenience sampling technique was used to draw samples from the targeted respondents. Like any other research project, challenges and limitations are inevitable and were encountered. The researcher faced the challenges of accessing private and confidential data from the SMEs enlisted as respondents. In countering that, the researcher gave assurance to the authorities that the information will solely be used for academic purposes only and will not be published anywhere. The research study concludes with some recommendations to help SMEs in the growth and sustainability of their ventures. Among the recommendations, the SMEs should formalise their operations so that they follow all the compliance regulations.