Effect of Deposit Money Banks' Credit on the Performance of Micro, Small and Medium Enterprises in Nigeria

Authors

G. O. Evbuomwan, University of Ibadan, IbadanFollow
V. O. Okoruwa, University of Ibadan, IbadanFollow
A. E. Ikpi, University of Ibadan, IbadanFollow

Publisher

Central Bank of Nigeria.

Keywords

Micro, Small and Medium Enterprises, Economic Development, SMEs, Finance, Credit

Abstract

This paper set out to empirically evaluate the effect of deposit money banks' credit on the performance of MSMEs in Nigeria, with the aid of a vector autoregression and error correction mechanism (ECM) technique. Results of the empirical investigation confirmed credit had a positive effect on GDP of MSMEs in Nigeria as the coefficient of CAM (credit to MSMEs) was positive (1.0569) and significant at 1.0 per cent level. It was, therefore, recommended that every effort should be made to improve access to credit by MSMEs, so that they could play their potential roles of employment generation and wealth creation and move the majority of the entrepreneurs out of poverty.

Author Bio

Evbuomwan is a retired staff of the Central Bank of Nigeria, Lagos and currently a Ph.D student in the Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria, while Okoruwa and Ikpi are professors and staff of the Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria.

Publication Title

CBN Economic and Financial Review

Issue

2

Volume

51

Recommended Citation

Evbuomwan, G. O., Okoruwa, V. O., & Ikpi, A. E. (2013). Effect of Deposit Money Banks' Credit on the Performance of Micro, Small and Medium Enterprises in Nigeria. CBN Economic and Financial Review. 51(2), 63-91.