The Informal SME Perspective Of Government Policies On Smes' Business Environment In Lesotho

Abstract

Informal SMEs in Lesotho constitute the majority, employing 80% of the workforce and contributing 30.9% to the economy. This study examines the perspective of informal SMEs in Maseru, Berea, Mafeteng, and Leribe districts about the impact of government policies on the business environment. This qualitative research employed a phenomenological approach. Data from semi-structured interviews and document analysis were thematically analysed using Atlas.ti. The findings revealed that many SMEs operate informally due to high formalisation costs, complicated procedures, and limited finance. It concluded that complex regulations create SMEs’ registration barriers. The study highlights barriers preventing SMEs from joining the formal economy.