Microfinance is a financial institution that is involved in provision of small scale financial services to low income people .The bulk of the microfinance industry in developing and emerging countries is subsidy-dependent. African and Asian MFIs compensate for non-subsidization by charging higher interest rates. The impact of outreach on financial performances of MFIs is still unclear.Moreover, there seems to be inconsistencies have also arisen on the role of subsidies on performance of firms.The general objectives of this study is to evaluate factors contributing to the financial performance of MFIs in Imenti North Sub-County. This study may benefit policy makers in the ministry of finance, the management of MFIs,the association of microfinance, the managers, potential investors and the employees. The study was guided by micro-credit and agency theories. This study adopted a descriptive research design. The target population was 42 respondents which included all the branch managers, operational managers and credit managers of the 14 microfinance institutions operating in Imenti North Sub-County. The study used a census technique which utilized both primary and secondary data.Collection of primary data employed structured questionnaire as a research instruments. Secondary data was collected from MFIs financial reports and Association of MFIs in Kenya. Both descriptive and inferential methods were used in data analysis. The study established that MFIs' outreach measured in terms of total membership significantly influence financial performance of an MFI.It was also found out that interest rates charged by MFIs significantly influence their financial performance. It was determined that subsidies received by MFIs significantly influence their financial performance. The study recommended that MFIs should strive to increase their total membership. It was also recommended that MFLs should work towards increasing the amount of deposits by reaching out to more people. The study further recommended that MFIs should determine interest rate that ensures financial performance as well as increasing total loan uptake.The study also recommended that MFIs should seek subsidies from both the donors and the government.