Demeke, Mulat (PhD)Temesgen, Berhanu2021-11-222023-11-182021-11-222023-11-181998-06http://etd.aau.edu.et/handle/12345678/28799The study was conducted in two market [Owns, namely, Debre Birhan and Assela with the aim of identify ing the impact of microcredit on micro enterprise income. According to the findings of the study, borrowers in Debre Birhan were able to increase monthly enterprise income from 181.14 Birr per month before the loan to 252. 77 Birr per month after the loan. Non- borrowers reported current monthly enterprise income of Birr 154. 77. Borrowers in Assela indicated an increase in enterprise income from Birr 139.32 p er month before the loan to Birr230 per month after the loan. The current enterprise income of the non- borrowers was Birr 282.94 per month. The regression result showed that income is affected by several factors . Among the many factors, credit was significantly correlated to average microenterprise income in Debre Birhan. Credit was not significantly correlated with income in the case of Assela. Enterprise income was also affected by start-up capital, non-paid family workers, paid employees and productive assets in Debre Birhan. The other variable which correlated to income was the type of economic activity. Those who were engaged in service enterprises earned more income than manufacturing in both towns. As indicated credit was not Significantly correlated with income in the case of Assela. The possible reasons for this result were: - a) Improper selection of borrowers; b) lvfisleading information during the initiation of the project; c) Low business activity as compared to Debre Birhan and d) Low level of credit provided to operators in Assela.enMicro FinanceContribution to EnterpriseThesis