Authors : R. Koledoye and Olajide O. Adeola
Abstract: Majority of Nigerians living in the rural areas live below the poverty level, one major reason for this situation is the absence of one of the most crucial factors of production which is capital. The microfinance policy was introduced in Nigeria to ameliorate the situation and business expansion among small and medium scale enterprises. The study investigated the economic success of SMEs which collected credit from MFIs. Primary data were collected from a hundred microfinance bank customers using structured questionnaires. Those selected were beef, pepper and garri traders. Descriptive and inferential statistics were used to analyze the data. The results showed the enterprises were profitable but limited in scope because the entrepreneurs did not identify opportunities for expansion; consequently they lacked strategic plans towards such goals. The different enterprises compared were significantly different in terms of prices even though the average amount of loan collected was not. The level of patronage, volume of sales and number of loans were found not to be of significant difference in the enterprises. The study indicates that MFIs have positive impact on the micro-enterprises but it could be more significant if business management services as part of the services offered. The policy implication is that microfinance policy needs to be expanded to include business development services.
R. Koledoye and Olajide O. Adeola, 2014. Economic Success of Credit Dependent Micro-Enterprises in Oyo State. International Business Management, 8: 93-96.