The Effects of Interest Rate on Micro, Small and Medium Enterprises Financing Decision in Wa Municipality of Ghana
Bawuah Bernard, Yakubu Awudu Sare, Alhassan Musah

Abstract
This study investigates the effects of interest rate on micro, small and medium enterprises’ (MSMEs) access to funds and their financing decision in Wa municipality of Ghana. A multiple research method and descriptive survey were employed to permit the study to make use of bothquantitative and qualitative data collection techniques and data analysis procedures. This is because we wanted to portray an accurate profile of the enterprises, events and situations in order to obtain information which can be analysed and patterns extracted and comparisons made.In all, 200 enterprises were chosen for the research. Evidence from the analysisshows that majority of MSME businesses have resorted to the use of equity financing for their operations. This was attributed to several factors of which interest rate was the leading cause. It emerged that interest rate affects choice of financing decision of MSMEs in Wa municipality. In order to help thesemicro, small and medium enterprises, the cost of credit facilities should be reviewed downwards to enable smooth repayment and increase in the demand for loans by MSMEs to enable them grow their businesses which will in effect have ripple effect in the economy.

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