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ALAS.pptx
1. IMPACT OF MICROFINANCES SERVICES
TO THE BUSINESS PERFORMANCE OF
SMALL AND MEDIUM-SIZED
ENTERPRISES IN CARMEN DAVAO DEL
NORTE
QUEENIE MARIE O. ALAS, MBA
Researcher
2. Background of the study
• The satisfactory performance of small-scale businesses is an
important mainstream in a nation’s economy (Bagudu et al.,
2016).
• However, report of Bagudu et al. (2016) indicated that poor
business performance among this sector remains an increasing
problem among financial experts worldwide due to the fact that
the industrial sector is represented by almost 90% of the small-
scale business in terms of number.
• In the Philippines, Elvinia (2005) reported that small-scale
enterprises continually face many impediments to succeed.
3. Background of the study
• On one hand, Cautero and Rasure (2021) described microfinance
as a type of banking service provided to unemployed or low-
income persons or businesses who in any other case would have
no different get admission to economic services.
• Meanwhile, several studies indicate significant relationship
between microfinance and business performance of small scale
businesses. However, those studies were conducted in foreign
setting and utilized qualitative approach.
• It is on this context, that the researcher felt the need to fill-in the
research gap of conducting a study in the Philippine setting,
particularly in Davao del Norte using a quantitative approach.
4. Statement of the Problem
1.1 accessibility and flexibility;
1.2 reliability; and
1.3 affordability of the interest rate?
1.
What is the level of microfinances services among the small
and medium-sized enterprises in Carmen, Davao del Norte in
terms of:
2.1 strategy;
2.2 capability; and
2.3 innovation and learning?
2.
What is the level of business performance among the
small and medium-sized enterprises in Carmen, Davao
del Norte in terms of:
5. Statement of the Problem
3.
Is there a significant relationship between
microfinances services and business performance
among the small and medium-sized enterprises in
Carmen, Davao del Norte?
4.
Which domain of microfinances services
significantly influence the business performance
among the small and medium-sized enterprises in
Carmen, Davao del Norte?
6. Conceptual Framework
Microfinance
• Affordability of
interest rate
• Accessibility and
Flexibility
• Reliability
Business
Performance
• Capability
• Strategy and
Innovation
• Learning
Independent Variable Dependent Variable
8. Research Design
• Quantitative research method utilizing
a non-experimental descriptive-
correlational research design
• To investigate the impact of
microfinances services to the business
performance of small and medium-sized
enterprises in Carmen, Davao del Norte
9. Research Locale
• This study will be
conducted in Carmen,
Davao del Norte. Carmen
is about 38 kilometers (24
mi) from Davao City, and
about 17 kilometers (11
mi) from Tagum City, the
capital of Davao del
Norte, has a total land
area of 16,600 hectares
(41,000 acres).
10. Research Respondents
• The respondents of the study will be the small and
medium-sized enterprises owners in Carmen, Davao del
Norte, Philippines
• The 130 respondents will be selected through simple
random sampling technique.
11. Research Instruments
• The first part of the instrument concerned about the
microfinance which will be adapted from the study of
KiflieHayleeyesus (2016) indicated with affordability of the
interest rate, accessibility and flexibility, and reliability
• The second tool will be adapted from the study of Wu
(2010). Business performance is indicated with capability,
strategy and innovation and learning.
12. Research Instruments
• The questionnaire will be pilot
tested among the small-scale
businesses in Panabo City
and expected to obtain a
Cronbach’s alpha value
greater than 0.700 to ensure
that the questionnaires will
have high level of internal
consistency.
14. • Mean and Standard
Deviation
• Pearson Moment Product
Correlation
• Multiple Linear Regression
Statistical Tools
15. Review of Related
Literature
Microfinance Services
• Accessibility and
flexibility
• Reliability
• Affordability of interest
Business Performance
• Strategy
• Capability
• Innovation and
learning
Relationship between
Microfinance Services and
Business Performance
16. Results and
Discussion
• Level of Microfinances Services
• Level of Business Performance
• Significant Relationship between Microfinances
Services and Business Performance
• Significant Influence to Business Performance
17. Results and Discussion
Table 1 : Level of Microfinances Services
Indicators/Statements Mean SD Description
1.1 Accessibility and Flexibility
1. The loan repayment schedules are convenient
for the clients.
3.69 0.81 High
2. Appropriate training has been given by the
microfinance institution to start and manage a
business.
3.77 0.68 High
3. The level of support received from the
microfinance institution have been encouraging to
run the business.
3.82 0.61 High
4. I am free to allocate the loan amount received
in the productive activity of my choice.
3.73 0.59 High
5. I have easy access to loan in the microfinance
institution.
3.61 0.63 High
Category Mean 3.72 0.31 High
18. Results and Discussion
Table 1 : Level of Microfinances Services
Indicator/Statement Mean SD Description
1.2 Reliability
6. The loan amount provided by the microfinance
institution is sufficient enough to run a business.
3.72 0.68 High
7. The services offered by the microfinance
institution are well organized and well structured.
3.84 0.50 High
8. Staff of the microfinance institution lends
attention to details when interacting with clients.
3.76 0.62 High
9. Employment opportunity has been increased as
the result of participating in the microfinance
programs.
3.67 0.64 High
10. My financial position has been increased as
the result of participating in the microfinance
program.
3.58 0.67 High
Category Mean 3.71 0.33 High
19. Results and Discussion
Table 1 : Level of Microfinances Services
Indicator/Statement Mean SD Description
1.3 Affordability of the Interest Rate
11. The interest rate charged by the microfinance
institution is fair and affordable.
3.59 0.70 High
12. The reimbursement term is negotiated
between me and the microfinance institution.
3.62 0.58 High
13. The affordability of of the interest rate of the
microfinance institution increased my savings.
3.63 0.64 High
14. The number and type of assets you have
possessed increased as the result of low interest
rate of the microfinance institution.
3.61 0.68 High
15. The interest rate charged by my microfinance
institution is suitable for my business
3.57 0.63 High
Category Mean 3.60 0.32 High
20. Results and Discussion
Table 2 : Level of Business Performance
Indicator/Statement Mean SD Description
2. 1 Strategy
1. I can create a definite strategy for the company. 3.67 0.65 High
2. I employ strategies that are based on target
customers, markets, environment
3.73 0.64 High
3. I employ strategy that are developed, reviewed
and updated periodically based on the information
from customers, environment, and performance
measurement.
3.62 0.70 High
4. I provide established products to new market. 3.78 0.77 High
5. I provide new products to exist market. 3.77 0.68 High
Category Mean 3.71 0.35 High
21. Results and Discussion
Table 2 : Level of Business Performance
Indicator/Statement Mean SD Description
2.2 Capability
6. I can response customers’ needs swiftly. 3.67 0.65 High
7. I can effectively manage people and
resources.
3.58 0.63 High
8. I show appropriate managerial system with
improvement capability adaptive to resource and
environment changes.
3.66 0.67 High
9. I deeply understand the technology trend and
catch the changes.
3.69 0.81 High
10. I exhibit flexibility to adapt to new industry
and market trends.
3.77 0.68 High
Category Mean 3.67 0.37 High
22. Results and Discussion
Table 2 : Level of Business Performance
Indicator/Statement Mean SD Description
2.3 Innovation and Learning
11. I investment in new products development. 3.67 0.65 High
12. I practices the efficiency of NPD processes
(the input of NPD/output of NPD)
3.51 0.67 High
13. I give emphasis on the importance of having
entrepreneurial training.
3.79 0.65 High
14. I renew the organizational structure and
system based on the environmental changes.
3.67 0.65 High
15. I show flexibility to adapt to new industry and
market trends.
3.52 0.67 High
Category Mean 3.63 0.48 High
23. Results and Discussion
Table 3: Significant Relationship Between Microfinances
Services and Business Performance of SME’s
Microfinancing
Business Performance
r-value p-value Interpretation Decisions
Affordability of the Interest Rate 0.400 0.664 Not Significant Accept H0
Accessibility and Flexibility 0.511 0.000 Significant Reject H0
Reliability 0.138 0.132 Not Significant Accept H0
OVERALL 0.358 0.000 Significant Reject H0
*significant @ p<0.05
24. Results and Discussion
Table 4: Significant Influence of Microfinance Services to the
Business Performance of SME’s
Microfinancing
Business Performance
B Beta p-value Interpretation Decisions
Affordability of the
Interest Rate
-.074 -.067 0.406 Not Significant Reject H0
Accessibility and
Flexibility
.584 .521 0.000 Significant Reject H0
Reliability .152 .143 0.074 Not Significant Accept H0
R2
= 0.265
F-value = 15.317*
p-value = 0.000
*Significant @ p<0.05
26. Results and Discussion
Table 1
The Level of Microfinance Services
Indicator SD Mean
Descriptive
Level
Accessibility and Flexibility 0.31 3.72 High
Reliability 0.33 3.71 High
Affordability of Interest Rate 0.32 3.60 High
Overall 0.20 3.68 High
27. Results and Discussion
Table 2
The Level of Business Performance of SME’s
Indicator SD Mean
Descriptive
Level
Strategy 0.36 3.71 High
Capability 0.37 3.67 High
Innovation and Learning 0.48 3.63 High
Overall 0.35 3.67 High
28. Summary of Findings
1. Microfinance services of SME’s acquired an overall
mean score of 3.68. Meanwhile, microfinance services
in terms of accessibility and flexibility, reliability, and
affordability of interest rate acquired the mean scores of
3.72, 3.71, and 3.60, respectively.
1. Business performance of SME’s acquired an overall
mean score of 3.67. Meanwhile, business performance
of SME’s in terms of strategy, capability, and innovation
and learning acquired the mean scores of 3.71, 3.67,
and 3.63, respectively.
29. Summary of Findings
3. The result showed microfinance services has a
significant positive relationship with the business
performance of SME’s with a p-value of .000 that is less
than .05 level of significance (two-tailed) (r = .358,
p<0.05).
4. The level of microfinance services in terms of
affordability of interest rate and accessibility and
flexibility significantly influenced business performance
of SME’s as evident on the F-value of 15.317 and
p<0.05. The r2 value of 0.265 indicated that
microfinance services have contributed significantly to
the variability of business performance of SME’s by
26.50% from the total variability.
30. Conclusion
1. The level of microfinance services in terms of
accessibility and flexibility, reliability, and affordability of
interest rate, acquired a high rating. Overall,
microfinance services of SME’s belongs to high
descriptive rating.
2. The level of business performance of SME’s in terms of
strategy, capability, and innovation and learning were
described as high.
3. The result showed that microfinance services has a
significant positive relationship with business
performance of SME’s.
4. The level of microfinance services in terms of
affordability of interest rate and accessibility and
flexibility significantly influenced the business
performance of SME’s.
31. Recommendations
1. The Philippine‘s microfinance sector should conduct
training course evaluation after a training program.
2. The Philippine’s microfinance sector should develop
more branches of microfinance institution in order to
increase the access to loans.
3. Other personnel in the field of research should further
conduct research on the context of microfinancing and
business performance to see to it that improvements
and developments are continuously promoted in the
small and medium-sized enterprises.
