Access to Finance and Sustainability of Small and Medium Enterprises in Central Uganda

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International Journal of Research and Innovation in Social Science (IJRISS) | Volume V, Issue IX, September 2021 | ISSN 2454–6186

Access to Finance and Sustainability of Small and Medium Enterprises in Central Uganda

Byakatonda Patrick, Mabonga Eric, Byamukama Eliab Patrick
Kampala International University, College of Economics and Management, P. O. Box 20000, Kampala, Uganda

IJRISS Call for paper

Abstract: This paper sought to establish the effect of Access to finance on sustainability of Small and Medium Enterprises (SMEs) in central Uganda. A mixed methods approach (quantitative and qualitative) was adopted. Cross-sectional, descriptive and narrative designs were employed by this study. Self-administered questionnaires and key informant interview guide were the main instruments of data collection on a sample of 281 SMEs as determined by Krejcie and Morgan (1970) table for determining sample size. Data was analyzed using SPSS and content analysis. Results revealed that access to finance has a significant effect on business sustainability in central region in Uganda (R Square = .263; beta = .341). SMEs with limited or no access to finance find it difficult to grow and sustainability has remained a challenge; SMEs that have access to finances are able to ensure sustainability. This research study recommends government financing scheme to entrepreneurs/enterprises initiated to provide finances to SMEs in particular, and a financing policy for SMEs should be developed and then the government should provide financing at fair interest rates. Still SMEs should well be classified by status and sector before advancing them with finances.

Keywords: Access to Finance, Sustainability of SMEs.


According to (Ref.1) Sustainability is more than just a trend. It is surfacing a new paradigm that acknowledges the complexity of systems and the inequities or imbalances that can undermine their sustainability. Sustainability is diffusing across all disciplines, from ecology to art, and agriculture to architecture. It challenges decision makers not just to manage resources at a point in time, but manage resources across time. By incorporating time, it also recognizes that the future is not always knowable and controllable, but that such uncertainty is acceptable when systems are resilient.
Since the introduction of the triple bottom line sustainability assessment accounting, a variety of approaches have been developed to quantify sustainability using the three axes of social, economic and environmental sustainability (2). His methodology was based on the notion that businesses should be economically prosperous, promote environmental quality and be champions of social justice to be considered truly sustainable (2).