Abstract: Formal lending institutions including Commercial banks fail to satisfy financial needs of smallholders, mainly due to stringent lending terms and conditions. The general objective of this study was to assess the effect of informal finance on the performance of SMEs in Kiambu County. The specific objectives were; to establish the effect of financial Self-help groups on the performance of SMEs; to examine the effect of family and friends finance on the performance of SMEs; to determine the effect of trade credit on the performance of SMEs and lastly to establish the effect of Shylock financing on the performance of SMEs.