Prevailing Challenges Affecting Performance of Micro, Small and Medium Enterprises in Tanga Urban.

Omary, Buduka (2025) Prevailing Challenges Affecting Performance of Micro, Small and Medium Enterprises in Tanga Urban. Masters thesis, The Open University of Tanzania.

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Abstract

This study explored the prevailing challenges affecting the performance of Micro, Small, And Medium enterprises (SMEs) in Tanga urban, specifically in Mgandini, Ngamiani, and Streets 15 and 16. The study aimed to assess the impact of procedures for accessing microcredit services, examine the role of government and nongovernmental organizations in promoting SME growth, evaluate the effects of working capital loans, and investigate the influence of technological change and innovation on SME performance. The research was guided by Agency Theory and Institutional Behaviour Theory. Data was collected through questionnaires from 50 randomly selected respondents and analyzed using SPSS. Findings revealed that the loan procedures offered by microcredit institutions are often complex and not aligned with the needs of SME owners. Respondents indicated limited support from government institutions in raising awareness and providing relevant business information. Furthermore, inadequate knowledge about technological changes, market dynamics, and microcredit services were major obstacles to business development. Other significant challenges identified include misallocation of funds, rigid credit policies, and poor access to domestic markets. The study concludes that addressing these barriers is essential for SME performance improvement. It recommends regular engagement between SMEs and stakeholders, enhanced information sharing, and a review of loan policies by financial institutions to better support business growth. Key words: Capital, technological, training and regulatory

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