IMPACT OF MICRO FINANCE BANK LOAN ON THE PERFORMANCE OF SMALL-SCALE BUSINESSES IN MAIDUGURI METROPOLIS, BORNO STATE, NIGERIA
Samuel Tashiwa Pukuma
ABSTRACT
The Importance of Small Scale Businesses has been stressed globally especially in creating jobs and wealth among the poor. However the Deposit Money Banks have not being able to support SSBs financially due to collaterals, this was why Micro Finance Banks were created to fill this gap. Microfinance bank loan is paramount to the performance of small scale businesses as small scale business sector is globally regarded as an important tool for driving economic growth and employment creation in both developing and developed economy. It is against this background that the study assesses the impact of microfinance bank loan on the performance of small scale businesses in Maiduguri Metropolis. Survey method was used to obtain data from the owners of small scale businesses through questionnaire administration while regression analysis was used in analyzing the data. Findings of the study submits that there exist a significant relationship between micro finance bank loan and the profitability of Small Scale Businesses (SSBs); findings also revealed that a significant relationship exist between Micro finance bank loan and the sales volume of SSBs and that the relationship of micro finance bank and capitals employed is highly significant. The study recommended that government and stakeholders should make provision for training and enlightenment of owners of small businesses in the area of capital expansions so as to help them maximize their loan opportunities and also increase labour employments, the study also recommended that government should improve on the state of infrastructural facilities to reduce the transactional cost associated with the administration of micro credit in the country so as to assist small scale businesses.