Contributions of SACCOs on the Growth and Sustenance of Small Businesses in Tanzania: The case of Mbeya City

Despite the initiatives taken by the government to improve the growth and \nsustenance of small businesses and tremendous growth of SACCOs in Mbeya City, \nsmall businesses have continued to suffer. The study investigated how SACCOs \nhave contributed on the growth and sustenance of small businesses in Mbeya City. \nThe main objective of this study was to analyze general contributions of SACCOs on \nthe growth and sustenance of small businesses in Mbeya City. Specifically the study \nassessed challenges facing the growth and sustenance of small businesses and \nanalyzed potentials of SACCOs in supporting the growth and sustenance of small \nbusinesses. The area of the study was in Mbeya City and the simple random \nsampling technique was employed. The sample size of 64 respondents was chosen \namong traders, Mbeya City Cooperative Officers and Loan Officers of Lulu and \nUpimaji SACCOs. Statistical Package for Social Science (SPSS) was used for data \nanalysis. Study showed that the potentials of SACCOs on supporting the growth and \nsustenance of small businesses in Mbeya City is still low due to the higher rates of \ninterest charged on loans advanced to members and poor training given on how \nmembers should improve significantly their businesses. Findings concluded that the \ncontributions of SACCOs to promote the growth and sustenance of small businesses \nin Mbeya City is poor due to the combinations of challenges. Among these include; \nhigh interest rates charged on loan to members, absence of seminars and training to \nbusiness proprietors. It was recommended that measures should be employed to \nmake taxation system fair and also it was recommended that SACCOs loans \nprovided to members should be of lower interest rates and SACCO’s management \nshould prepare training to members on how to run their businesses.