Financial Management Practices and Growth of MSMEs of Tanzania

Abstract

The significant objective of this study is to explore financial management practices and the growth of MSMEs in Tanzania. This research was guided by the following objectives: financial innovations, investing activities, risk management practices and working capital management. Since the MSMEs population is quite high, the target population for this study was estimated at over 400 management staff from selected MSMEs in Dar es Salaam. The study discovered that financial innovations influence the growth of MSMEs of Tanzania to abundant scope and that the aim of innovation in an enterprise is to make a profit. The study also recommends that it is important for MSMEs to invest so that investments can grow to compete against inflation and future reservations. Managers should build an effective business support system as a key condition for the success of investment capacity building. The study found that there is a need to look at the challenges facing MSMEs of Tanzania.