Analyzing the Impact of Microfinance Banks Credit Variables on Micro, Small Enterprises Growth Indicators in South-West, Nigeria
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Date
2020-06
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IISTE : Research Journal of Finance and Accounting
Abstract
Despite several reforms both in the banking and informal sectors; it is sad that there have been dwindling
development in both sectors. In view of this, this study analyzed the impact of Microfinance Banks (MFBs) credit
variables on Micro Small Enterprises (MSEs) growth indicators in South-West, Nigeria. Sampled MFBs, MSEs
and some South-West States were purposively selected. Secondary data was extracted from financial statements
of eight selected MFBs from 2007-2016 (10years). Relationship between MFBs variables and MSEs’ growth was
analyzed using Correlation matrix, while extent at which MFBs variables influenced MSEs growth was analyzed
using panel regression. Results showed the relationship between MFBs credit variables and MSEs’ growth with
an average ‘r’ at 68.56% (p<0.05); and the extent at which MFBs credit variables influenced MSEs growth (p<0.05)
such as profit, total asset, number of employee growth and sales with R2 were 61.4%, 58.3%, 48.1% and 52.1%,
respectively. The study concluded that MFBs credit variables influenced MSEs growth. It was recommended that
MFBs should moderately increase loan size in order to improve MSEs’ business operations.
Description
Staff Publication
Keywords
Microfinance Banks,, Micro Small Enterprises,, Credit Variables,, Growth indicators,, South-West,, Nigeria