Effect of Microfinance Services on Performance of Selected Women-Owned Businesses in Gasabo District, Rwanda

Ariane Mutangampundu and Wilson Bashaija
University of Kigali
Email: arianempundu@gmail.com

Abstract: This study examined the effect of Microfinance Services on the Performance of Selected Women-Owned Businesses in Gasabo District, Rwanda. Specifically, the study assessed the effect of Savings Services on the Performance of Selected Women-Owned Businesses. A descriptive and correlational research design was adopted using a quantitative approach. The target population comprised 1,865 women-owned businesses, from which a sample size of 329 respondents was determined using Yamane’s formula. Data were collected using structured questionnaires, and 302 valid questionnaires were returned, representing a response rate of 91.8%. Data were analyzed using SPSS Version 25 through descriptive statistics, Pearson Product-Moment Correlation, and simple linear regression analysis. The findings indicated a strong positive and statistically significant relationship between Savings Services and business performance, with r = 0.754 and p = 0.000. Regression results showed that Savings Services significantly affected business performance, with R = 0.754 and R² = 0.569, indicating that Savings Services explained 56.9% of the variation in business performance. The regression coefficient was positive (B = 0.537, Beta = 0.754, t = 19.882, p = 0.000). Therefore, the null hypothesis was rejected. The study concluded that Savings Services significantly improved the performance of women-owned businesses by supporting financial capacity, cash-flow management, business growth, continuity, and sustainability. The study recommends that microfinance institutions improve the accessibility, convenience, and flexibility of savings services and strengthen financial education to encourage regular saving and effective utilization of savings for productive business activities.