Muhoza sector, Musanze District in Northern Province of Rwanda was taken under the study to analyze the role of\naccess to finance for small and medium enterprises (SMEs) performance within a period from 2012-2015. The sample size\nof the study was 133 SMEs from the total population of 2128 SMEs. In order to achieve the objectives, this study employed a\ndescriptive case study design and the data were collected using questionnaires and interview techniques. Data was analyzed\nusing descriptive statistics and linear multiple regression analysis and then presented in statistical tables. The results show\nthat the factor influencing access to external finance was Simple application procedures for loan with 84%. Also the results\nconfirmed the role of access finance such as improve profitability (91%) improve firm efficiency (87%), prevent liquidity\nproblems (72%), improve firm solvency (69%) and increase of assets quality (64%). Other role of access to finance by SMEs\nis to meet expenditures which accounted for 39 percent of the responses. The results confirm the hypothesis because the\nlinear regressions are significant at p<0.05. The study conducted a multiple regression analysis from which means all the\nindependent variables have a significant contribution to SMEs. There is therefore the need to design short courses in the area\nof financial management practices for entrepreneurs, particularly those with lower educational background as education is\nan important factor in accessing finance. Size of the firm was also found to be a significant factor affecting access to finance\nand therefore small firms should come together to form bigger firms in order to attract sources of finance. Banks and other\nfinancial providers should have a department solely devoted to the financing needs of SMEs and develop products purposely\nfor SMEs which contribute to economic development of Rwandans society.
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