Babcock University Research Portal

EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA

Authors: Shetty , Asikhia Olalekan , AKINLABI Babatunde , & MAKINDE Olabisi

Publication Type: Journal article

Journal: International Journal Of Advanced Research

ISSN Number:

Downloads

Views

Abstract

Banks are important source of credit to business organizations most especially to SMEs that
have no access to capital markets in order to raise funds. Deposit money banks close the
funding gap that informal or internal sources cannot fill. This paper examined effect of
business credit availability (information asymmetry, bank density, and credit rationing) on
the profitability of small and medium enterprises in South-West, Nigeria. The study adopted
cross-sectional survey research design. Data were obtained through primary source using
self-developed structured questionnaire. The population of the study comprised 26,744
registered Small and Medium Scale Enterprises operating in South-West, Nigeria. Cochran’s
sample size formula was employed to determine sample size of 843 SME owners/managers.
Partial Least Square Structural Equation Modeling (PLS-SEM) through Smart PLS 3.2.8.
Smart PLS was employed to analyze and test hypothesis. The path analysis and bootstrapping
results showed that information asymmetry, bank density, and credit rationing have positive
and significant effect on the profitability of small and medium enterprises in South-West,
Nigeria. Further, the results revealed that the effect size is small in line with Cohen criterion.
The study concluded that bank density, information asymmetry and credit rationing are seen
to be major constraints to the profitability of SMEs, most especially from the South-West,
Nigeria. The study recommended that there should be Central Bank of Nigeria (CBN) credit
policies that should be tailored towards branch expansion by the deposit money banks that
could be accessible to SMEs

Access to Documents

External Link
Download
Digital Object Identifier

Keywords

Shetty,K. Asikhia,O. AKINLABI,B. MAKINDE,O. . (2020). EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA, 8 (), 713-713.

Shetty,K. Asikhia,O. AKINLABI,B. MAKINDE,O. . "EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA" 8, no (), (2020): 713-713.

Shetty,K. and Asikhia,O. and AKINLABI,B. and MAKINDE,O. and . (2020). EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA, 8 (), pp713-713.

ShettyK, AsikhiaO, AKINLABIB, MAKINDEO, . EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA. 2020, 8 ():713-713.

Shetty,K. , Asikhia,Olalekan , AKINLABI,Babatunde , and MAKINDE,Olabisi . "EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA", 8 . (2020) : 713-713.

S.K. A.Olalekan A.Babatunde & M.Olabisi , "EFFECT OF BUSINESS CREDIT AVAILABILITY ON PROFITABILITY OF SMALL AND MEDIUM ENTERPRISES IN SOUTH-WEST, NIGERIA" vol.8, no., pp. 713-713, 2020.

Access to Documents

Keywords

About Us

Admissions

Contact Us

Policies

ALUMNI

STUDENT POPULATION