Credit In Nigeria Research Articles

Challenges of Bank Credit Among Small and Medium Enterprises (SMEs) in Nigeria

The survey research design was adopted, and the study was specifically designed to evaluate the challenges of bank-credit among SMEs in Nigeria and make recommendations. The questionnaire and indent interview methods were used to generate data. Data generated were coded and analyzed through tables, frequencies, percentages and X2. Bank credit refers to loans, advances and discounts (LAD) extended to borrowers for productive ventures. Nigerian Banks are still very slow in lending to SMEs. They believe that SMEs are usually not properly organized and therefore consider lending to the sector highly risky. Where they must lend, they insist on stringent loan processes including the provision of adequate collateral. These stringent loan processes frequently cut off many SMEs from having access to bank credit, and to check insider fraud, banks have placed embargo on lending without collateral. The study found that it is not easy for SMEs to have access to bank credit in Nigeria. Ten recommendations were made based on the result of the study.

Features of small scale enterpreneur and access to credit in Nigeria: a microanalysis

This study investigates determinants of access of small-scale enterprises to credit in Nigeria. Three hundred and fifty respondents were selected using stratified sampling techniques. Descriptive statistics such as percentages, frequency distribution and logit regression were employed in analyzing the data. The results showed sex, age, marital status, family size, capital assets, interest rate, and level of education and other dwelling characteristics of small-scale enterprises influence access to use of credit from credit institutions. Key works: Small-scale enterprises, Access to Credit, Credit Markets, Nigeria.

Recovering of micro credit in Nigeria

PurposeThis paper aims to examine the factors that are responsible for the poor credit recovery among micro‐finance institutions (MFIs) that disbursed a United Nations Development Programme's micro credit in Anambra State, Nigeria.Design/methodology/approachA total of 97 MFIs were surveyed out of a total of 129 MFIs in Anambra State in 2007. A ten‐item researcher developed questionnaire on a four‐point Likert scale was used to measure MFIs' staff assessment of factors that were responsible for poor credit recovery. Descriptive statistics were used to analyse the data, and conclusions and implications of the findings are presented.FindingsFrom the findings of this study, it is evident that multidimensional factors contribute to low credit recovering by the MFIs. These factors can be summarised under borrowers' wrong attitude to credit repayment, MFIs' staff weak skill and corrupt tendency, and poor infrastructural provision by the government. Arguably, these factors have direct effect in encumbering genuine effort at alleviating poverty in Nigeria through the instrumentality of micro credit. This calls for a change in strategy especially on the part of the MFIs in reducing the incidence of low credit recovery.Research limitations/implicationsThe paper offers fresh insight that would offer better understanding of the informal sector of the financial system in Nigeria that has hitherto received limited research attention.Practical implicationsThis paper is informative in terms of the imperativeness for public policy adjustment and firm‐level competencies required for better operation of the MFIs in Nigeria. This would translate into creating viable micro‐credit sector to support current plans to eradicate poverty and foster the development of the “bottom‐of‐the‐pyramid”.Originality/valueAddresses issues related to micro credit in a highly challenged and isolated context.

The Consumption Function and Informal Sector Credit in Nigeria

The Consumption Function and Informal Sector Credit in Nigeria

Pledging Oil Palms: A Case Study on Obtaining Rural Credit in Nigeria

The practice of borrowing money has always existed. Rarely do individuals, groups, communities, or even governments, have enough money to execute their needed programs or carry out their most urgent and important obligations. Financial difficulties, therefore, can and often do lead people to borrow money. Although facilities and sources for borrowing vary between developed and developing countries, it is universally accepted that both the borrower's and the lender's interests must be protected in the transaction. In most developed countries, the main sources of loans are financial institutions. Borrowers negotiate directly with these institutions with regard to both rates of interest and loan repayment. In the developing countries, however, financial institutions are very limited in their ability to provide lending services, especially to the rural people. Consequently, most developing countries have created other methods of borrowing. These methods vary from one country to another. As Herskovits observed (1965: 225-6), “The institution of credit is widely spread in non-literate societies, accompanies all types of exchanges, and is found in cultures of all degrees of economic complexity.” One method developed over the years in the Cross River State of Nigeria and, in fact, in most parts of Nigeria, has been pledging. Pledging involves the institutional transfer of the use rights of a piece of property from one individual to another in return for a sum of money. The individual who advances the credit enjoys usage rights of the pledged property until he receives his money back. The practice of pledging oil palm trees is as old as the society itself and continues today in spite of the recently promulgated Land Decree (Nigerian Federal Ministry of Information, 1978).

Improved agricultural credit in Nigeria

This paper is concerned with the provision of credit to farming smallholders in Nigeria. The need for credit is established and an outline given of the historical development of agricultural credit institutions in Nigeria. The paper concludes that banks and other institutions have problems in dealing with individual smallholders because of difficulty of contact, lack of information and uncertainty in the supervision and repayment of loans. It is suggested that farmer co-operative societies appear to be the best means of bringing essential credit to such smallholders.