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The Role of Credit for Small Business Success

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  • Joseph Andrew Kuzilwa

Abstract

The objective of this article is to examine the role of credit in generating entrepreneurial activities. The paper is based on a recent research combining case studies with a sample survey of businesses that gained access to credit from a Tanzanian government financial source. A substantially increased output is observed following access to credit. The findings reveal that the enterprises whose owners received business training and extension advice performed better than those that did not. The study further shows that many of the problems faced by the entrepreneurs are not related to capital, but rather arise as a result of macroeconomic and institutional constraints. Examples of the reported business barriers are poor infrastructural support and stiff competition amongst the micro and small–scale producers.

Suggested Citation

  • Joseph Andrew Kuzilwa, 2005. "The Role of Credit for Small Business Success," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 14(2), pages 131-161, September.
    • Handle: RePEc:sae:jouent:v:14:y:2005:i:2:p:131-161
    DOI: 10.1177/097135570501400204
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    References listed on IDEAS

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    1. Christian Rogerson, 2000. "Successful SMEs in South Africa: The case of clothing producers in the Witwatersrand," Development Southern Africa, Taylor & Francis Journals, vol. 17(5), pages 687-716.
    2. Mead, Donald C. & Liedholm, Carl, 1998. "The dynamics of micro and small enterprises in developing countries," World Development, Elsevier, vol. 26(1), pages 61-74, January.
    3. Michael McPherson, 1995. "The hazards of small firms in Southern Africa," Journal of Development Studies, Taylor & Francis Journals, vol. 32(1), pages 31-54.
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    Cited by:

    1. Osuji Chinaemerem Casmir, 2014. "Impact of Micro Credit on the Performance of Women Entrepreneurs in Delta State," International Journal of Empirical Finance, Research Academy of Social Sciences, vol. 2(1), pages 45-51.

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