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Factors Affecting Access to Formal Credit by Micro and Small Enterprises in Uganda

Author

Listed:
  • Faisal Buyinza
  • Anthony Tibaingana
  • John Mutenyo
Abstract
This article investigates the factors affecting access to formal credit by micro and small enterprises in Uganda using the Gender Enterprise Survey that was funded by the IDRC. The study employed a probit model. The findings show that firm sales, owner's education level, belonging to a business association, belonging to business group, use of internet, owning a personal and business bank account, and gender of the owner are positively associated with access to formal credit. We also find that experienced firms are less likely to apply for credit hence reduce the probability to receive formal bank credit. Our results provide insights on the existing gaps in designing supportive policies for micro and small enterprise to enable them increase their access to credit especially from the formal financial institutions.

Suggested Citation

  • Faisal Buyinza & Anthony Tibaingana & John Mutenyo, 2018. "Factors Affecting Access to Formal Credit by Micro and Small Enterprises in Uganda," ICAE Working Papers 83, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    • Handle: RePEc:ico:wpaper:83
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    Cited by:

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    2. Meghann Puloc’h, 2021. "Ouganda : réviser le modèle de croissance tout en préservant la soutenabilité de la dette," Working Paper 1a139887-666a-4a53-8b6a-5, Agence française de développement.
    3. Geoffrey Nuwagaba & Festo Nyende & David Namanya, 2021. "Financing Options and Sustainable Small Business Growth in Uganda: An Optimal Model," International Business Research, Canadian Center of Science and Education, vol. 14(10), pages 1-85, October.
    4. Meghann Puloc’h, 2022. "Uganda: revising the growth model while preserving debt sustainability," Working Paper 1a139887-666a-4a53-8b6a-5, Agence française de développement.

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    Keywords

    Credit constraint; micro and small enterprises; sample selection; Uganda;
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