The impact of commercial bank credits on sme growth in Nigeria

Abstract

The lack of adequate finance has led to decline in the growth of the Small and Medium Scale Enterprise (SME) sector in Nigeria even with various instruments and policies put in place. This study employed Co-integration and Error Correlation Method (ECM) techniques to investigate the impact of commercial bank credits on SME growth in Nigeria between 1980 and 2016. The results revealed that SMEs and selected macroeconomic variables included in the model have a long run relationship with SMEs output. The result shows the commercial bank loans to SMEs has a positive and significant impact on SMEs output in the model. This implies a commercial bank loan to SMEs has been a major driving factor to the growth of SMEs in Nigeria.  Similarly, the coefficient of commercial bank deposits is not different. However, bank density (proxied by Number of Commercial Banks Branches in Nigeria) has a positive and nonsignificant impact on the growth of SMEs. This means that most banks are not located to areas that are easily accessible these entrepreneurs. The implication of this finding is that there is need for these banks to spread their coverage even to the rural areas were these loans can be easily used.

Table of Contents

CONTENT

Title page 

Certification

Approval

Dedication

Acknowledgements

Table of contents 

Abstract 

Chapter One: Introduction

1.1. Background to the Study 

1.2. Statement of the Problem

1.3. Research Questions 

1.4. Objectives of the Study 

1.5. Research Hypotheses 

1.6. Significance of the Study

1.7. Scope and Limitations of the Study 

1.8. Organization of the Study

Chapter Two: Literature Review

2.1. Review of Theoretical Literature 

2.1.1. Review of Conceptual Literature  

2.1.2. Review of Basic Theories 

2.1.3. Review of Other Related Theoretical Issues

2.2. Empirical Literature Review

2.2.1. Table: Summary of Empirical Literature Reviewed 

2.3. Summary of Literature Reviewed 

2.4. Justification of the Study

Chapter three

3.1. Theoretical Framework 

3.2. Empirical Model Specification 

3.3. Explanation of Variables 

3.4. Estimation Techniques and Procedures 

3.5. Evaluation of Estimates

3.6. Test of Research Hypothesis and Decision Rule

3.7. Nature and Sources of Data 

Chapter Four 

4.1. Result presentation and analysis

4.2. Evaluation of Research Hypotheses