Small and Medium Enterprises (SMEs) play an important role in the socio-economic
development of any country. They provide an appropriate channel for the
achievement of national macroeconomic objective in terms of employment generation
at low investment cost and enhancement of apprenticeship training. The objective of
the study was to determine the effect of access to micro financing on financial
performance of small medium enterprises in Gikomba Market, Nairobi County. The
study adopted descriptive research design. The study used a sample of 125
respondents out of whom 75 responded. Data analysis was done using SPSS version
20.0. The study established that the entrepreneurs in the study area accessed different
amounts of loan. The study also established that accessibility to microfinance affected
the performance of SMEs to a great extent. On the influence of savings and deposits
to financial performance of SMEs, the study established that savings allowed the
entrepreneurs a chance to borrow from the banks and also measured their revenue
generation capacity. The study also established that entrepreneurial development
played a key role in the performance of SMEs. The study concludes that the
accessibility of credit from credit facilities affects the financial performance of the
SMEs to a very great extent. The study concludes that the some of the SMEs traders
at Gikomba market have been able to make savings while others have not through
their respective MFIs. The study also concludes that the training has improved the
management skills of the entrepreneurs in Gikomba in financial management, record
keeping and business management. This study therefore recommends that the
management of MFIs revise their lending policies and requirements so as to ensure
that most of the traders can be able to access credit more easily. The study also
recommends that the MFIs use that traders savings as part of collateral since most
may not have large tracts of land or the physical collateral needed. The study also
recommends that the training on investment monitoring be offered more hours since it
was established that the traders had not improved their skills in the area.