ROLE OF MICROFINANCE INSTITUTIONS IN FINANCING MICRO AND SMALL ENTERPRISES IN ETHIOPIA

Micro and Small Enterprises (MSEs) understood as a means to attain the United Nations 2030 agenda particularly its contribution in reducing massive unemployment deep-rooted poverty. Hence, main aim of this paper is examine role Microfinance Institutions (MFIs) survival, value creation growth MSEs. For study purpose, secondary data were collected from National Bank Ethiopia (NBE) triangulated with systematic review empirical evidences. Principal Component Analysis (PCA) was used relationships significance between emerge. The evidences result reveals that unlike banks, MFIs provide diverse micro credit services address socio-economic needs poor who cannot afford collateral requirement besides PCA economic access microcredit service by itself not enough create more jobs they are uncorrelated. However, shows that, poorest most vulnerable people being left behind due lack finance, market linkage inadequate skill training among many other factors. Therefore, policy-makers have develop regulatory frameworks build sound financial institutions encourage competition one another.