Business formalization and growth of small and medium enterprises in Tanzania: the Case of SMES in Dar es Salaam Region

The literature has indicated that business formalization is an important strategy to facilitate legal business operations and contributes to the growth of business. This study examined the role of business formalization on growth of small and medium enterprises at Dar es Salaam City Tanzania. The study employed both qualitative and quantitative approaches. The primary data was gathered using interviews and questionnaire and secondary data was collected from various reports. The study found that business formalization plays great role in creating awareness and capacity building for better doing business, business recognition for access of capital from financial institutions, create business incentives and create conducive business environment that contribute to growth of small and medium enterprises. The study concluded that the government has to increase effort toward implementing MKURABITA strategies and programs of business formalization. More resources should be allocated so that more small and medium enterprises are formalized in order to improve their business legality in the country.