In the past, government has initiated series of micro programmes targeted at the poor with the overriding objective of making credit readily available to those who were traditionally denied access to credit.
THE ROLE OF MICROFINANCE IN SMALL SCALE ENTERPRISE A CASE STUDY OF OHHA MICROFINANCE BANK ENUGU STATE ABSTRACT This research work was undertaken to roles of microfinance banks in financing small and medium scale enterprise. It is against this backdrop that the purpose of this work attempts to ascertain the role of microfinance banks in small and medium scale enterprise in Enugu State, and specifically: 1.) In the light of this, the Central Bank of Nigeria (CBN) as part of its reform agenda, initiated Micro Finance Banks, a policy initiative aimed at bringing credit to the door step of the poor who do not have such access under the conventional financial system. The work was intended to achieve the following objectives to ascertain the extent to which micro finance bank has been assisting in providing credit facilities to small scale industrialists, to determine the cost of variability in small scale industrial financing by micro finance … Thus, microfinance banking is supposed to be the machineries for financial and economic emancipation as its growth is connected with the community in which it serves. Before now, commercial banks traditionally lend to medium and large enterprises which are judged to be credit-worthy. <>/ExtGState<>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/Annots[ 17 0 R 35 0 R 36 0 R] /MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>>
The study recommended that In order to reduce the risk of doubtful credit or facilities, the government should increase the percentage grants to micro finance banks for small and medium scale enterprises and also put more emphasis on credit guarantee scheme by introducing more of such scheme for the benefit of small and medium scale enterprises. However, the full potential of the micro business in the development process have not been realized owing to numerous bottlenecks. Ask us anything! The statement of the problem or challenges facing micro finance bank in financing small and meduim scale enterprises in Enugu are: i. It would be observed that, despite the presumed developments in the Nigerian economy, the country is still largely being regarded as a developing country (Onyema, 2006). More so, its industrial growth is not quite impressive. THE ROLE OF MICROFINANCE IN SMALL SCALE ENTERPRISE. This research work was undertaken to roles of microfinance banks in financing small and medium scale enterprise. It is worthwhile to note, according to Usang (2006), that many would recall how lack of funds often caused the collapse of small businesses and the extinction of ingenious ideas before they could be translated into reality. financing is more than dispensing loans, to be viable micro finance banks require experienced and skilled personnel. The problems that emanated from poor financing include: a) Lack of competent management which is the consequence of inability of owners to employ the services of experts. The statement of the problem or challenges facing micro finance bank in financing small and meduim scale enterprises in Enugu are: i. In the past, government has initiated series of micro programmes targeted at the poor with the overriding objective of making credit readily available to those who were traditionally denied access to credit. The data collected were analysis using simple tables and percentage analysis. %PDF-1.5
Okafor (1992), in his reports for micro finance banks being the main link between the formal and informal financial sectors. Micro finance banking institution were conceived and came into been in December 2007. 4.) However, Small and Medium scale Enterprises play important economic and social roles in employment creation and generation, economic growth and development, important linkages with larger enterprises, social security, creativity and innovations, financial markets profitability and growth (Olumide, 2011). However, the idea behind microfinance banking is to encourage rural development through rural commitment in modern financial institutions within the rural environment. iv. Also, interest on borrowed money was made as low as possible by the two banks to enable small-scale rural community industrialist and agriculturist to borrow with ease.
iii. The study recommended that In order to reduce the risk of doubtful credit or facilities, the government should increase the percentage grants to micro finance banks for small and medium scale enterprises and also put more emphasis on credit guarantee scheme by introducing more of such scheme for the benefit of small and medium scale enterprises.
It is now widely believed that following government’s acclaimed policies on rural development, rural investment will be given a boost via microfinance banking as all frustrations of our hardworking, devoted but under-privileged masses would come to an end. The Central institutions in Nigeria are relatively new, as most of them never registered after 1981. 4 0 obj
It is now common knowledge according to Egbe (2000) that the 1980s witnessed a rapid growth of commercial banking activities in many Nigerian rural communities where banking habits, culture, commitment and community development was poor if not non-existent. Suffice it to say that in rural communities, the rural business class hardly seeks formal institutional credits to improve their economic base. To what extent has Microfinance Bank assisted in providing credit facilities for rural development and problems hindering the assistance? The Central institutions in Nigeria are relatively new, as most of them never registered after 1981. Suffice it to say that in rural communities, the rural business class hardly seeks formal institutional credits to improve their economic base. What are the problems encountered by businesses in obtaining credit facilities from Microfinance Bank in Enugu? THE ROLE OF MICROFINANCE IN SMALL SCALE ENTERPRISE ABSTRACT This research work was undertaken to roles of microfinance banks in financing small and medium scale enterprise. 1 0 obj
To Identify and analyze the effect of microfinance banks on socio economic development i.e. To identify the problems encountered by small scale business in obtaining credit facilities from Microfinance Bank. The data collected were analysis using simple tables and percentage analysis. The financing in most cases in normally provided by the owners. Relevant data were collected from both primary and secondary sources.
What are the problems encountered by businesses in obtaining credit facilities from Microfinance Bank in Enugu? High Operating Cost: Small units of services pose the challenges of high operating cost, several loan applications to be processed, numerous accounts to be managed and monitored, and repayment collection to be made from several locations especially in rural communities. In the light of this, the Central Bank of Nigeria (CBN) as part of its reform agenda, initiated Micro Finance Banks, a policy initiative aimed at bringing credit to the door step of the poor who do not have such access under the conventional financial system. b) Use of obsolete equipment and methods of production because of owner’s inability to access new technology. Before the emergence of formal microfinance institutions, informal microfinance activities flourished all over the country. W�߽@ :��[�'�#�Nx�P�Xp*�b����H+�u]��N�wu/�b����T�A���YzF�#�������*������Ja��3�Q~?�Q�]Q��/1X�$�DL�T��HA�͟(\= W�SP��B���:��FB�*�=�?��� ��hT�t������!���*��p�o��=��k��IXF�"�`�~��}�2��t@rZu� �����e�"�ad�lͪy��Ɛ���,��b�>��XZy� From December 2007, a total of 402 community now micro finance Banks came into being with a total deposit of =N=20 million. To make borrowing easy enough for rural communities, these banks do not require sophisticated collateral for borrowing.
These are the objectives that the researcher will assess to measure growth of small and medium enterprises which is the dependent variable. For PROPER paraphrasing (see your university definition of plagiarism and acceptable paraphrase) 4. Microfinance institutions serve as primary credit and lending facilities for both low-income individuals and small and medium enterprises that fall shy of accessing easy loans from the organized financial sectors. In another development, small and medium enterprise experiences difficulties in raising equity capital from the finance houses or individuals. endobj
Traditionally, microfinance in Nigeria entails traditional informal practices such as local money lending, rotating credit and savings practices, credit from friends and relatives, government owned institutional arrangements, poverty reduction programmes etc (Lemo, 2006). The work was intended to achieve the following objectives to ascertain the extent to which micro finance bank has been assisting in providing credit facilities to small scale
Get Full Work (adsbygoogle = window.adsbygoogle || []).push({}); Disclaimer: Using this Service/Resources: You are allowed to use the original model papers you will receive in the following ways: 1. Repayment Problem: Loan default is a major threat. High Operating Cost: Small units of services pose the. To identify the problems encountered by small scale business in obtaining credit facilities from Microfinance Bank. It is instructive to note that during this period, community funds among rural dwellers were hardly gathered for savings and loans in order to stimulate domestic investment. The study will be on the performance of small scale industry business in Delta State the specific objectives... Industrial Relations and Personnel Management, More Economics Project Topics & Materials, THE ROLE OF MICROFINANCE BANK IN THE DEVELOPMENT OF SMALL SCALE ENTERPRISE, THE ROLE OF MICROFINANCE INSTITUTIONS IN FINANCING SMALL SCALE BUSINESSES, THE ROLE OF MICRO FINANCE IN SMALL SCALE ENTERPRISE, THE CONTRIBUTION OF SMALL SCALE INDUSTRY TO POVERTY IN NIGERIA CASE STUDY SMALL SCALE ENTERPRISE IN LOKOJA KOGI STATE, THE ROLE OF STRATEGIC PLANNING ON THE GROWTH AND SURVIVAL OF SMALL AND MEDIUM SCALE ENTERPRISE, THE ROLE OF FEDERAL GOVERNMENT IN THE PROMOTION OF SMALL AND MEDIUM SCALE ENTERPRISE IN NIGERIA, BENEFITS OF SMALL AND MEDIUM ENTERPRISE DEVELOPMENT AGENCY OF NIGERIA (SMEDAN) ON SMALL SCALE ENTREPRENEURS, THE IMPACT OF MICROFINANCE BANKING ON SMALL SCALE ENTERPRISES IN NIGERIA, THE IMPACT OF MICROFINANCE BANK ON THE PERFORMANCE OF SMALL SCALE BUSINESSES. �&P�o�m��'��//�}�+�Y�#(:͊�W��n����6��~�s�����5�w-�. ii. Such credits in the world over were used for the development of small and medium scale enterprise, which has been described as the springboard for sustainable development. It is therefore not certain whether or not micro-finance banks actually impacts on small and medium scale businesses in the rural communities. Thus, microfinance banking is supposed to be the machineries for financial and economic emancipation as its growth is connected with the community in which it serves.
This research work was undertaken to roles of microfinance banks in financing small and medium scale enterprise.
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