Challenges Faced by the MSMEs in Accessing Finance

Authors

  • Dr. K. Siva Nageswararao, Dr. Ch. MadhaviLatha

Abstract

Micro, Small, and Medium Enterprises (MSMEs) are still an interesting academic and policyrelated subject that study and understand the dynamics of the small business. There are a couple of studies
that investigate the determinates of MSMEs’ growth by adopting a personal approach (ownership
characteristics) and managerial approach (managerial characteristics/strategy related). The present paper is
aimed to explore the several challenges faced by the MSMEs to have access to financial resources where the
finance is said to be the oxygen of any organization. The variables considered for the study are the size of
the business, type of ownership of the business, and type of business. The study is restricted to only Guntur
and Krishna Districts’ of Andhra Pradesh, India. To attain the objectives of the study, it is intended to make
use of primary and secondary data. The data purifier tests being used in the study to know the suitability of
the data for analysis. The linear assumption, normality assumption, multicollinearity assumption, and
homoscedasticity assumption are used under regression analysis. The results clued that there is a strong
relationship between the size of the business and the accessibility of the firm. It means the size of the
business has a positive impact on the availability of financial resources for the business. The moderate
impact could be found between the type of ownership and accessibility of financial resources whilst the
same pattern exhibited in between type of business and availability of financial resources. It could be
concluded that the size of the firm provides leverage for the accessibility of financial resources thereby this
intact acts as an insulator for the growth of MSMEs to a great extent comparatively the rest of the two.

Published

2020-04-30

Issue

Section

Articles