Implications of Microfinancing On The Economy: The Nigerian Case
Loading...
Date
2011
Journal Title
Journal ISSN
Volume Title
Publisher
Global Conference on Business and Finance Proceedings
Abstract
Commercial banks traditionally lend to medium and large scale enterprises considered creditworthy but avoid dealing with the microenterprises because of their relatively, high associated costs and risks. However, microfinance institutions (MFIs) have, therefore, become the main source of funding microenterprises in developing countries. The main purpose of this study is to establish the funding options open to microenterprises in the country and the extent to which these have been accessed. It is also meant to assess the rate of growth of these enterprises and the factors accountable for this, especially, in the last ten years. The study also covered the funding challenges facing this subsector which include persistent refusal of commercial banks to finance microenterprises, the need to effectively implement the policy framework that would regulate and standardize MFIs operations, assessing medium to long term sustainable commercial sources of fund to mention just a few. Simple descriptive statistics was used to analyze the data collected for the study. The authors are of the view that separation of ownership and management and a strict compliance with the Micro Finance Regulatory and Supervisory Framework will further enhance the activities of these firms and ultimately impact positively on the economy.
Description
Keywords
Citation
Adenugba, A.A. and Babalola, A. (2011). Implications of Microfinancing On The Economy: The Nigerian Case. Global Conference on Business and Finance Proceedings. 6(2); 699-706.