Micro Credit Availability as A Catalyst for Small and Medium Enterprise Growth in Nigeria

The research study has specifically investigated how micro credit has assisted SMEs in SMEs growth through acquisition of raw materials and improvement in working capital of SMEs. The study employs the survey method in evaluating the impact of Micro credit availability as a catalyst for small and medium enterprise (SMEs) growth in Nigeria. The population of this study is based on SMEs in Edo State. Edo State was chosen forth is study since it has a large concentration of SMEs. The study adopted survey design and primary sources of data was employed. Questionnaire was designed using linkert scale format. The population of the study is infinite and Cochran formula was adopted to determine the sample size. Sample of 325 questionnaire was distributed out of which 300 returned their questions. The respondents were made of proprietors of manufacturing SMEs who are clients/customers of the Microfinance Banks. Data collected was analyzed using both descriptive and inferential statistics while hypothesis of the study was tested using chi-square distribution. The findings confirmed a significant contribution of micro-credit in assisting SMEs in areas of asset acquisition, acquisition of raw materials and improvement of their working capital. Where as, the study recommended among others that, government should try to provide sufficient infrastructural facilities such as electricity, good road network and training institutions to support SMEs in Nigeria. Government through CBN should also guarantee some of the credits extended to SMEs. This will give more SMEs who cannot meet the collateral requirement of banks to have access to credit as well.