Effects of Microfinance on the Performance of Micro-Enterprises in the Republic of Congo

The overall objective of this work is to analyze the effects of microfinance on the performance of micro-enterprises in the Republic of Congo. Specifically, this study analyzes the effects of microfinance on the financial performance of micro-enterprises. To achieve this, we used data from 11,105 businesses, taken from the General Enterprise Census of Congo (REGEC), conducted by the National Institute of Statistics (INS) of the Republic of Congo in 2020 with financial support from the World Bank. The estimates are based on the Tobit model to truncate the turnover variable, which captures financial performance, in order to determine the effects of microfinance on the financial performance of micro-enterprises. The results obtained reveal, on the one hand, that there is a positive and significant relationship between microfinance and the performance of micro-enterprises in the Republic of Congo. Furthermore, the variables of gender, age, education level, marital status of the business owner, telephone use, and internet use within the microenterprise are significant. In contrast, the nationality of the microenterprise owner is not significant. These results lead to recommendations for economic policy.