Browsing by Subject "MSMEs"

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    Open Access
    COVID-19 and post COVID-19 financing of MSMEs: a case of Johannesburg
    (2025) Tshehla, Kgaogelo; Alhassan, Abdul Latif
    Micro, small and medium enterprises (MSMEs) are widely accepted as the backbone of economic growth and contribute towards job creation and poverty alleviation. The role that MSMEs can play is amplified in South Africa, given the poor performance of the economy, high levels of inequality and unemployment. The government has instituted several initiativesand policies aimed at fostering the growth of MSMEs. However, despite these efforts, MSMEs find themselves facing various challenges, including access to finance. COVID- 19 threatened the survival and any growth prospects for MSMEs, but also prompted policy alterations in response to the crisis, aimed at delivering relief measures for the MSMEs. Therefore, this dissertation explored the impact of the COVID-19 policy responses on financing MSMEs in South Africa. Specifically, the study sought to understand the impact of COVID- 19 on the financing of MSMEs in based in Johannesburg and the benefits and challenges that MSMEs experienced in their attempt to obtain debt relief or access to finance. The dissertation employed a qualitative research approach in which primary data is collected from participants through interviews with MSMEs in Johannesburg, South Africa. The results of the thematic analysis found that financing options were required to support MSMEs with employee relief and retention, decrease in productivity, cash flow and supply chain issues, and information and communications technology (ICT) adoption. MSMEs encountered difficulties in trying to access finance, despite the credit guarantee schemes made available to them. A sentiment emerged that banks and government agencies exhibited a reluctance to attentively address the distinctive challenges faced by these enterprises, consequently constraining their ability to effectively communicate and navigate their specific circumstances. MSMEs also realized the importance of a compliant business as a prerequisite for accessing financial resources. An additional revelation pertained to the imperative of cultivating business resilience as a strategic imperative for enduring comparable crises should they transpire. The results also found that there were some benefits and challenges that MSMEs experienced when exploring their financing options. The thematic analysis identified two key benefits that MSMEs experienced in their attempt to obtain debt relief or access finance during the pandemic. These included the increased resilience and diversification of MSMEs. The two main challenges that MSMEs experienced where the inability to access employee relief schemes and access finance. It is recommended that MSMEs be educated on bank processes and requirements, business management, financial literacy and alternative sources of finance so as to illustrate the profitability of their business more accurately and understand credit affordability metrics. It is also recommended that financial institutions make better use of the credit guarantee schemes and improve take- up on the funds available from these schemes.
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    Open Access
    Exploring the drivers of using microinsurance in managing business risks by MSMEs in Kenya
    (2025) Wangalachi, Anne; Alhassan, Abdul Latif
    Micro, small and medium-scale enterprises (MSMEs) provide jobs and support economic growth. They are a lifeline to millions of individuals and families in Kenya. Protecting the resilience of these enterprises in Kenya and across Africa is a strategic imperative given their significance and their disproportionately heightened vulnerability to external socio-economic shocks from events such as the COVID-19 pandemic. This research explored the potential of insurance to enhance MSME resilience by protecting businesses and livelihoods against typical and emerging risks. Using a qualitative research design strategy with non-probability purposive sampling, data gathered through in-person interviews with MSME owners and employees provided insights into their perceptions, beliefs, and use of insurance, in particular microinsurance, for risk management. Findings indicated that most MSMEs were aware of and were using microinsurance to cover various aspects of their businesses. Some MSMEs had effectively relied on microinsurance to maintain their operations during the COVID-19 pandemic. They expressed their readiness to adopt a well-designed business interruption insurance product should this be available ahead of future pandemics. The study revealed key insurance product attributes that MSMEs value during times of risk including affordability, flexible premiums, timely claims payouts, and bundling with inventory, salary and income protection insurance. These insights are useful for insurers designing products to meet the specific needs of MSMEs in Kenya. The study also identified a research gap for future studies on the subject of supply-side drivers of MSME insurance in Kenya. Ultimately, building MSME resilience to shocks and sudden disruptions like the COVID-19 pandemic will require coordinated and concerted effort among insurers, regulators, policymakers, and multilateral development banks to design and promote context-specific MSME microinsurance products. At scale, these products will protect the livelihoods of MSME owners and employees and sustain the business operations of MSMEs for continued economic activity during future crises of similar magnitude to COVID-19.
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    Exploring the factors that influence the success of youth-owned MSMEs funded through microfinance funding: the case of the National Youth Development Agency (NYDA)
    (2025) Tsoai, Unathi; Albertus, Rene
    This study investigates the factors influencing the success of youth-owned Micro, Small, and Medium Enterprises (MSMEs) funded through microfinance by South Africa's National Youth Development Agency (NYDA). With youth unemployment remaining one of the country's most pressing challenges, the research explores how microfinance and non-financial support, such as mentorship and training, impact the sustainability and growth of youth-owned businesses. At its heart, the study gives voice to six young entrepreneurs, sharing their lived experiences and the real-world complexities they face. Using a qualitative, exploratory case study approach, data was gathered through semi- structured interviews with NYDA grant recipients, supported by document analysis and triangulation with official NYDA reports. The study draws on the Resource-Based View (RBV) and Institutional Theory to understand how internal strengths and external support systems interact to influence business success. Findings highlight that entrepreneurial success is shaped not only by access to funding but also by personal resilience, curiosity, the availability of relevant business support services, and strong mentorship. However, challenges such as slow funding processes, limited market access, and poor communication from support institutions emerged as common pain points. Still, the overall perception was that NYDA's intervention had a positive impact on both business growth and the confidence of the entrepreneurs themselves. By offering grounded, context-specific insights into youth entrepreneurship, this study contributes meaningfully to the growing body of knowledge on microfinance in emerging economies. Its recommendations aim to help refine public support programmes, making them more responsive, inclusive, and impactful for the next generation of business leaders in South Africa.
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    Open Access
    Micro, small medium enterprise (MSMEs) and financial inclusion in Zambia
    (2021) Masialeti, Nalumino; Alhassan, Abdul Latif
    This study investigated Zambia's current financial inclusion state with specific reference to micro, small and medium enterprises (MSMEs). It also sought to determine the relationship between the age of the owner of MSME, size, literacy, gender, age, the period of operations, asymmetrical information, and financial inclusion in Zambia. The data collected from 70 respondents comprising MSMEs owners were analysed using multiple regression, correlation analysis and descriptive statistics. The research employed dependent variables, notably access, availability, and financial services, as the dependent variable. In contrast, independent variables included the size of MSME, literacy level, income level of the owner of MSME, the period of operations and asymmetrical information. On the one hand, the empirical findings indicate a positive relationship between usage and availability of financial services, and 'MSME's age of owner, size, literacy, gender, age, operation period, asymmetrical information in Zambia. On the other hand, findings, however, also show a negative relationship between gender and financial inclusion access. Whilst a positive relationship with the remaining independent variables. Accordingly, the study concluded that financial inclusion is evident in Zambia among MSMEs. However, the primary issue is that most MSMEs do not have access to formal funding from formal financial institutions. Therefore, the study calls for policies to be put in place to help MSMEs have access to formal financing. In addition, it also proposes formalising 'women's informal sector, financial literacy roadshows for women in the informal sector, training women in digital skills to enable them to have better access to financial services and giving financial institutions targets to onboard women-led MSMEs.