Survey: Entrepreneurs opt for savings rather than loans to grow investments

Firm owners apprehensive about loans have reservations about the payment modalities and concerns in case of default. [iStockphoto]

Entrepreneurs seem to be shunning loans from mainstream financial institutions in favour of family and friends, according to a new report.

The report, titled Financial Services: How Small Firms Manage their Finances, which is part of a series dubbed Small Firm Diaries published by Financial Sector Deepening -Kenya, lists bank loans as the third source of funding for those starting businesses.