Abstract:
This study examines the benefits and challenges of microfinance initiatives for small business growth in Yangon Region, Myanmar. The main aim is to understand how different microfinance services affect small business performance and what problems small business owners face when using these services. The research focuses on key microfinance elements such as loan access and size, loan terms and pricing, savings services, non‑financial services and training, monitoring and relationships, and MFI policy and lending practices. A quantitative research method was used, and data were collected through a structured questionnaire from 384 small business owners who are clients of licensed microfinance institutions in Yangon. The data were analyzed using descriptive statistics and multiple regression analysis. The results show that microfinance services have a generally positive effect on small business performance, especially in improving cash flow, inventory levels, and overall business performance. Savings services, MFI policy and lending practices, monitoring and relationship, and loan access and loan size have significant positive effects on small business growth. However, loan terms and pricing, and current non‑financial services and training do not show a strong or significant impact. The findings also indicate that many small businesses use microfinance mainly to support daily operations and survival, rather than for major expansion or job creation. Challenges such as high interest costs, repayment pressure, and limited practical training remain. The study recommends improving loan flexibility, strengthening savings products, redesigning training to be more practical, and enhancing client protection and policy support. Overall, microfinance is helpful but must be better designed and supported to promote sustainable small business growth in Myanmar
Keywords: Microfinance, Small Business Growth, Myanmar
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