Deindustrialization in Bulawayo has led to the burgeoning of the informal sector evidenced by the emergence of many MSMEs.The research sought to assess the contribution of Microfinance loans to growth of MSMEs in Bulawayo (2009-2013). The research adopted a descriptive survey design. Primary data was collected through questionnaires and interviews from MSMEs. The research finds strong evidence that the contribution of microfinance loans to growth of MSMEs is not significant. Microfinance Institutions activities in the establishment of new MSMEs is nonexistent with most MSMEs source of funding coming from savings, friends and relatives. The study recommends that Microfinance Institutions engage in extensive marketing research and outreach programmes to MSMEs .This will help them to identify specific needs and design products that are suitable and tailored made for MSMEs.