Microfinance institutions in Kenya continue to put in a lot of effort to take microfinance services closer to the people and to MSMEs who do not have opportunities to access formal financial systems. Despite all these efforts, MSMEs have stagnated in terms of growth. It is in this respect this research investigated the contribution of microfinance services to the growth of MSMEs in Bungoma County. The main objective of this study was to determine the contribution of microfinance services to the growth of MSMEs in Bungoma County. This was motivated by the need to fill up the academic gap on the effect of microfinance institutions on growth of SMEs left by other researchers. Specifically, the objectives were: To establish the contribution of financial intermediation to the growth of MSMEs in Bungoma county, to examine the contribution of savings to the growth of MSMEs in Bungoma County, to investigate the contribution of market networking to the growth of MSMEs in Bungoma County and to determine the contribution of capacity building to the growth of MSMEs in Bungoma County. This study was conducted through a descriptive survey research design. The target population was 728 registered MSMEs in the county as well as nine microfinance institutions in Bungoma County. The sample size was 74 registered MSMEs and 18 representatives from the six microfinance institutions in Bungoma County. The sampling technique was stratified random sampling because most MSMEs in Bungoma County are not homogeneous. A questionnaire was used to collect data and its validity and reliability were established in the pilot test. Qualitative and quantitative data were generated in this research. Both quantitative and qualitative methods were used in analyzing data. Qualitative data analysis was used in analyzing information obtained from open ended questions from the questionnaire. Quantitative analysis involved drawing inferences using statistical package for social sciences (SPSS). A multiple regression analysis was undertaken to establish the relationship between dependent and independent variables. The strength of the relationship between dependent and independent variables was measured by carrying out Z-test at 5% level of significance and 95% level of confidence. The study outcomes showed that the most popular microfinance service provided by microfinance institutions is the provision of small scale business loans as indicated by 46.7% of the respondents. Provision of savings services accounted for 26.7% showing that MFIs encourage MSMEs owners to save with them. Capacity building and mobile banking services in equal measure accounted for 13.3%. Though they are present, they are not as popular as small scale business loans and savings services. Promotion of marketing services is the least popular microfinance service with 6.7% response. The research recommended that MSMEs should be encouraged to access small scale business loans in order to boost their capital which eventually promotes growth, Capacity building services should be carried out through seminars which equips MSMEs with updated management practices to help keep up with competition, Marketing should also be embraced through establishment of networks and effective channels of communication and MSMEs should also be encouraged to save funds with MFIs.
