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Patricia Lindelwa Makoni ORCID logo, Lindiwe Ngcobo ORCID logo


The purpose of this study was to examine the impact of firm-specific characteristics on the accessibility of firm financing in Zimbabwe using 2011 data from World Bank enterprise surveys. The results of the study show that firm characteristics in Zimbabwe determine the type of financing that is used for investment and working capital purposes. Small firms seem to rely more on internal financing as opposed to using bank funds, probably due to their small operations and lack of assets to put up as collateral. The larger firms however find it easier to access bank finance as they are much older in terms of age, have developed good relations with their financial services’ providers and are also able to provide the required collateral to back their lines of credit. Both domestic and foreign-owned firms highlighted financial constraints as a major obstacle to their businesses. However foreign firms seemed to access bank loans easier than domestic firms. Also, gender seems to play a minor role in the financing decisions of the firm. It is therefore recommended that the Government engages the financial market intermediaries to find feasible business financing solutions for all sized firms, especially those owned by locals. This would lead to the much-needed economic growth through investment attraction and employment creation.

Keywords: Finance, Firm Characteristics, Zimbabwe

How to cite this paper: Makoni, P. L., & Ngcobo, L. (2014). Finance and firm characteristics in Zimbabwe. Corporate Ownership & Control, 11(2-5), 465-472.