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The effect of ease of access on financial prosperity of micro and small entrepreneurs in Nairobi County, Kenya

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  • Anne Kimari

    (United States International University Africa, Kenya)

  • San Lio

    (United States International University Africa, Kenya)

  • Agnes Ogada

    (United States International University Africa, Kenya)

Abstract

The purpose of this paper is to establish the effect of the ease of access to mobile credit on the financial prosperity of MSEs. The ease of access describes the simplicity and easy way of enabling the provision of credit to a mobile money subscriber. Mobile credit means the credit offered through mobile phones whether from mobile phone operators in conjunction with banks or non-bank financial institutions or stand-alone mobile finance companies as per AFI - Global (2020) definition. This study tries to analyze whether there is a relationship between ease of access and the financial prosperity of an entrepreneur. Financial prosperity on the other hand is the economic well-being of a person or institution. The study adopted a descriptive research design. The target population for this study was 271,365 Licensed Small and Micro entrepreneurs in Nairobi County as per the Nairobi City County Licensing Database as of 16th November 2020. The sampling design employed a stratified sampling design to achieve a representative sample of the respondents. The sample size was 400 MSEs from each MSE, and the owner or key member was picked to participate. Overall, it was found that ease of access to mobile credit had a positive influence on financial prosperity. This implies that improved access to mobile credit leads to improved financial prosperity. An increase in Ease of access has a significant positive relationship (1.741432) with the financial prosperity composite. An increase in ease of access by one unit leads to an increase in financial prosperity by 1.741 units. Based on the study findings, it is recommended that mobile lenders should offer mobile credit with affordable terms. The mobile credit lenders should maintain a short period of the mobile money application process and approval to enhance the profitability and leverage of businesses. With good use of mobile credit, increased liquidity would increase financial prosperity for micro and small entrepreneurs. Key Words:Ease of Access, Financial Prosperity, Mobile Credit, MSEs.

Suggested Citation

  • Anne Kimari & San Lio & Agnes Ogada, 2022. "The effect of ease of access on financial prosperity of micro and small entrepreneurs in Nairobi County, Kenya," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(6), pages 314-323, September.
    • Handle: RePEc:rbs:ijbrss:v:11:y:2022:i:6:p:314-323
    DOI: 10.20525/ijrbs.v11i6.1946
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    References listed on IDEAS

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    1. Mai Huong Giang & Bui Huy Trung & Yuichiro Yoshida & Tran Dang Xuan & Mai Thanh Que, 2019. "The Causal Effect of Access to Finance on Productivity of Small and Medium Enterprises in Vietnam," Sustainability, MDPI, vol. 11(19), pages 1-19, October.
    2. Silber, William L, 1983. "The Process of Financial Innovation," American Economic Review, American Economic Association, vol. 73(2), pages 89-95, May.
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    Cited by:

    1. Catherine W. Gathitu & Dr David Kabata & Dr Grace Kiiru, 2024. "Influence of Government Sponsored Enterprise Funds-Credit Services on the Growth of Group-Based Micro and Small Enterprises in Kenya," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(2), pages 1326-1340, February.

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