Factors influencing access to financial services among small business holders in Kasipul sub county, Homa bay county

Abstract

The study focused on factors influencing access to financial services by small business holders in Kasipul Sub County, Homa Bay County. The study was informed by the objectives; to investigate the influence of cost credit, collaterals, access to information and availability of lending institutions on access to financial services in Kasipul Sub County. The study would be significant to several key stakeholders in the small business sector, informing them of measures to be put in place to enhance the growth of this sector of the economy. It was based on the basic assumptions that the data collection instruments would be valid and reliable in taking the expected measures, samples drawn would represent the target population in its major features and that respondents would be willing to give information honestly and objectively. Moreover, the study was grounded on the micro finance theory. The study adopted descriptive survey research targeting a population of 1500 small business holders and bank loaning personnel in Kasipul, from a sample of 150 respondents was drawn. Data was collected using questionnaire and interviews and analysis was undertaken using descriptive statistics such as the frequencies and percentages. The analyzed information was presented in frequency distribution tables. It was established that access to financial services by small business holders in Kasipul Sub County was relatively low as the cost of the credit was high, collaterals were hard to realize, access to information was poor, and lending institutions were found to be few. The study recommended that there is need to train more clients on management of loans and better ways of accessing crucial information on financial mobilization for growth of small holder business. Areas of further studies could be on the accessibility of microfinance among female versus the males, there is need to investigate the repayment rate of the clients and why there low repayment rates experienced by financial institutions.