Metrics

  • citations in SCIndeks: 0
  • citations in CrossRef:0
  • citations in Google Scholar:[]
  • visits in previous 30 days:8
  • full-text downloads in 30 days:7

Contents

article: 2 from 4  
Back back to result list
2018, vol. 20, iss. 2, pp. 109-125
Financial institutions' criteria and mechanisms in financing small and medium enterprises in Plateau state, Nigeria
University of Jos, Department of Actuarial Science, Nigeria

emailadesolojosh@gmail.com
Abstract
The inability of small and medium enterprises (SMEs) to access funds from financial institutions has been identified as one of the major problems limiting their expansion horizons. This study assesses the criteria and mechanisms used by financial institutions when granting loans to SMEs. The data were sourced from the relevant financial institutions and analyzed by using different statistical tools. One of the findings revealed that the financial ratio and the internal control system accounted for 28.7% of the part of the conditions for granting loans to SMEs. Similarly, good working capital and the ease of asset conversion accounted for 94.5% of the criteria used by financial institutions to extend credits/loans to SMEs. Also, the educational background of SMEs' operators significantly influenced the financial institutions' choice of SMEs to finance. Based on these findings, the study recommends that there is a need for SMEs' operators to align their business activities with financial institutions' lending criteria.
References
Adeyele, J.S., Omorokunwa, O.G. (2016) Risk Appetites and empirical survival patterns of SMEs in Nigeria. Journal of Entrepreneurial Finance, 18(2)
Agyapong, D., Agyapong, G.K.Q., Darfor, K.N. (2011) Criteria for Assessing Small and Medium Enterprises’ Borrowers in Ghana. International Business Research, 4(4):
Asantey, J.O., Tengey, S. (2014) The determinants of bad loans in financing small and medium-size enterprises in the banking sector in Ghana: A factorial analysis approach. International Journal of Research in Business Management, 2(11); 13-26
Bamfordt, C.D., Bruton, G.D. (2006) Small Business Management: A Framework Forn Success. United States: Thomson
Bank of England (2001) Quarterly report on small business statistics. London, UK, Bank of England, January; 1-46
Beck, T., Demirgüc-Kunt, A., Laeven, L., Maksimovic, V. (2006) The determinants of financing obstacles. Journal of International Money and Finance, 25(6): 932-952
Beck, T., Demirgüç-Kunt, A. (2006) Small and medium-size enterprises: Access to finance as a growth constraint. Journal of Banking & Finance, 30(11): 2931
Haron, H., Said, S.B., Jayaraman, K., Ismail, I. (2013) Factors influencing Small Medium Enterprises (SMES) in obtaining loan. International Journal of Business and Social Science, 4(15); 182-195
Iyortsuun, A.S. (2017) An empirical analysis of the effect of business incubation process on firm performance in Nigeria. Journal of Small Business & Entrepreneurship, 29(6): 433-459
Kira, A.R. (2013) Determinants of Financing Constraints in East African Countries’ SMEs. International Journal of Business and Management, 8(8):
Levy, B. (1993) Obstacles to Developing Indigenous Small and Medium Enterprises: An Empirical Assessment. World Bank Economic Review, 7(1): 65-83
 

About

article language: English
document type: Original Scientific Paper
DOI: 10.5937/ekonhor1802109A
published in SCIndeks: 30/08/2018
Creative Commons License 4.0