The effects of mobile money banking on the financial performance in selected micro and small enterprises in Lusaka, Zambia.

Abstract

This study evaluated the effects of mobile money banking in selected Micro and Small Enterprises (MSEs) in Lusaka District, Zambia. The study used an embedded mixed research design with a view to increase reliability and validity of the research findings. The qualitative data were collected using guided interviews while questionnaires were employed to obtain quantitative data. Regression and correlation analysis were used to analyse quantitative data while qualitative data were analysed using thematic technique. The findings revealed that mobile money banking did not have meaningful effect on financial performance in selected micro and small enterprises in Lusaka based on loan access (b = 0.5, r = 0.281, and coefficient determinant of 0.079). Consequently, the study further unearthed challenges such as access to marketing opportunities, access to loans, limited management skills, and low education among MSEs owners. Despite the weak relationship between mobile money and financial performance, MSEs ominously contribute to employment creation although sustainability still remain a challenge. In the sight of the research findings, the following key recommendations emerged: 1. Financial lending institutions should have an option to remove loan ceilings borrowed to Micro and Small Enterprises for startup, and expansion of their businesses. 2. Mobile Money Banking institutions should increase the amount of loans if they are to play a pivotal role in shaping the growth of Micro and Small enterprises in Lusaka.