EFFECT OF MICROFINANCE PRACTISES ON THE PERFORMANCE OF WOMEN OWNED ENTERPRISES IN BUNGOMA TOWN

Abstract

Micro financing is the provision of financial services to low-income clients or solidarity lending groups that lack

access to banking and its related services. Traditionally, women based enterprises have not been favoured by

the mainstream credit policies of the commercial banks owing to their inability to raise collateral securities to

guarantee the loans. Despite a multitude of studies devoted to the topic, the effect of microfinance practises on

the performance of women owned enterprises remain largely unexplored in Kenya. This research project seeks

to bridge the gap by establishing the effect of microfinance practises on the performance of women owned en

terprises in Bungoma town. The research design for this study was descriptive survey design because the study

was done once at a specified time. The population of the study comprised of all the women enterprises that are

registered with microfinance institution. They were sampled using stratified sampling to sample out the women

entrepreneurs who are registered with microfinance institution and simple random sampling to select the women

owned enterprises that were involved in the study the theory guiding this research is Entrepreneurship Theory

of Shane (2003). The theory consists of opportunity discovery, evaluation of the opportunity and the decision to

exploit the opportunity. Others elements of the theory include self-employment, business operation and performance.