Does informal finance matter for micro and small businesses in Africa?
Globally, micro and small businesses require finance to support their business activities. Most of them have low profits because of the lack of support from the formal financial system. Micro and small businesses in developing countries have a dire need for financing start-ups and existing business...
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| Format: | Article |
| Language: | English |
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Asociación Española de Contabilidad y Administración de Empresas (AECA), Universidad Politécnica de Cartagena (UPCT)
2022-03-01
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| Series: | Small Business International Review |
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| Online Access: | https://sbir.upct.es/index.php/sbir/article/view/415 |
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| author | Stephen Mago Florah Sewela Modiba |
| author_facet | Stephen Mago Florah Sewela Modiba |
| author_sort | Stephen Mago |
| collection | DOAJ |
| description | Globally, micro and small businesses require finance to support their business activities. Most of them have low profits because of the lack of support from the formal financial system. Micro and small businesses in developing countries have a dire need for financing start-ups and existing business operations. The lack of support from the formal financial system and the government forces them to explore other financial support mechanisms, making it important to investigate alternative financial channels. This paper investigates whether informal finance matters for micro and small businesses. We used a systematic literature review to answer the predetermined research question. Thirty (30) primary studies were surveyed to establish the importance of informal finance for micro and small businesses. The findings show that informal finance is a workable alternative for micro and small businesses. It supports business start-ups, existing businesses and enhances business growth, business owners’ livelihoods and livelihoods in their communities. Informal finance models can be improved to work as small business promotion tools. The original value of the paper is based on the use of a systematic literature review to assess whether informal finance matters for micro and small businesses and connect theories with emerging themes. It further contributes to the debates on the importance of informal finance and contributes to future lines of research on informal finance. |
| format | Article |
| id | doaj-art-c298687528aa4e499eb491a5a29a8095 |
| institution | OA Journals |
| issn | 2531-0046 |
| language | English |
| publishDate | 2022-03-01 |
| publisher | Asociación Española de Contabilidad y Administración de Empresas (AECA), Universidad Politécnica de Cartagena (UPCT) |
| record_format | Article |
| series | Small Business International Review |
| spelling | doaj-art-c298687528aa4e499eb491a5a29a80952025-08-20T02:19:04ZengAsociación Española de Contabilidad y Administración de Empresas (AECA), Universidad Politécnica de Cartagena (UPCT)Small Business International Review2531-00462022-03-0161e41510.26784/sbir.v6i1.415415Does informal finance matter for micro and small businesses in Africa?Stephen Mago0Florah Sewela Modiba1Nelson Mandela University, Faculty of Business and Economic Sciences, Department of Development Studies - Gqeberha - Eastern Cape ProvinceNelson Mandela University, Faculty of Business and Economic Sciences, Department of Development Studies - Gqeberha - Eastern Cape ProvinceGlobally, micro and small businesses require finance to support their business activities. Most of them have low profits because of the lack of support from the formal financial system. Micro and small businesses in developing countries have a dire need for financing start-ups and existing business operations. The lack of support from the formal financial system and the government forces them to explore other financial support mechanisms, making it important to investigate alternative financial channels. This paper investigates whether informal finance matters for micro and small businesses. We used a systematic literature review to answer the predetermined research question. Thirty (30) primary studies were surveyed to establish the importance of informal finance for micro and small businesses. The findings show that informal finance is a workable alternative for micro and small businesses. It supports business start-ups, existing businesses and enhances business growth, business owners’ livelihoods and livelihoods in their communities. Informal finance models can be improved to work as small business promotion tools. The original value of the paper is based on the use of a systematic literature review to assess whether informal finance matters for micro and small businesses and connect theories with emerging themes. It further contributes to the debates on the importance of informal finance and contributes to future lines of research on informal finance.https://sbir.upct.es/index.php/sbir/article/view/415informal financefinancial exclusionmicro and small businessessystematic literature reviewafrica |
| spellingShingle | Stephen Mago Florah Sewela Modiba Does informal finance matter for micro and small businesses in Africa? Small Business International Review informal finance financial exclusion micro and small businesses systematic literature review africa |
| title | Does informal finance matter for micro and small businesses in Africa? |
| title_full | Does informal finance matter for micro and small businesses in Africa? |
| title_fullStr | Does informal finance matter for micro and small businesses in Africa? |
| title_full_unstemmed | Does informal finance matter for micro and small businesses in Africa? |
| title_short | Does informal finance matter for micro and small businesses in Africa? |
| title_sort | does informal finance matter for micro and small businesses in africa |
| topic | informal finance financial exclusion micro and small businesses systematic literature review africa |
| url | https://sbir.upct.es/index.php/sbir/article/view/415 |
| work_keys_str_mv | AT stephenmago doesinformalfinancematterformicroandsmallbusinessesinafrica AT florahsewelamodiba doesinformalfinancematterformicroandsmallbusinessesinafrica |