ABSTRACT
This
work investigated the relationship between micro finance and entrepreneurial
development aimed at reducing poverty in the economy.
The primary method of data collected from
small and medium enterprise were used for their study. In the analysis table
and simple percentage were used.
Major findings of this work reveals that
there is a strong positive relationship between micro financing and
entrepreneurial development further findings shows that provision of long term
loans and equity capital by micro finance bank for enterprise are factors that
militated against micro finance in the economy.
This work recommended that guidelines for micro
finance institutions to finance SME’s need to be flexible to accommodate the
SME’s in terms of granting them long-term loans and quality capital
participation.
This will be of immense benefit to SME’s
micro finance banks authority and the students of body and firms who may be
interested in further research on this topic.
TABLE OF CONTENTS
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
1.2 STATEMENT OF THE PROBLEM
I.3 OBJECTIVE
OF THE STUDY
1.4 RESEARCH QUESTIONS
1.5 RESEARCH HYPOTHESIS
1.6 SIGNIFICANCE OF THE STUDY
1.7 SCOPE / DELIMATION OF THE STUDY
1.8 LIMITATION OF THE STUDY
1.9 DEFINITION OF TERMS
CHAPTER TWO
2.1 NIGERRIA
BUSINESS ENVIRONMENT
2.2 THEORETICAL
REVIEW.
2.3 GOVERNMENT VIEW OF THE MICRO FINANCE SECTOR.
2.4 PROSPECTS
AND PROBLEMS OF MICROFINACE
2.5 THE
PROSPECTS OF MICRO FINANCES BANKING
2.6 THE
GOAL OF MICROFINANCE BANKS.
2.7 POLICY MEASURES AND INSTRUMENTS IN THE
ETIABLISHMENT OF THE FRAMEWORK FOR MICROFINANCE BANKS
2.8 OGGANIC
GROWTH PATH FOR MFMS
2.9 DEMERITS
OF MICROFINANCE BANK
2.10 THE INTEREST OF LOCAL AND INTERNATIONAL
COMMUNITIES IN MICROFINANCE.
2.11 INVESTIGATING IMPACT OF MICROFINANCE ON
SMALL SCALE ENTERPRISES.
2.12 EVOLUTION
OF MICROFINANCE
2.13 HOW GOVERNMENT CONTRIBUTION TO
MICROFINANCE SECTOR.
2.14 OWNERSHIP
STRUCTURE OF MICROFINANCE
2.15 FEATURES
OF MICRO FINANCE BANK.
2.16 CHALLENGES/
PROBLEMS OF MICRO FINANCE
CHAPTER THREE
3.0 RESEARCH
MEHTODOLOGY
3.1 RESEARCH
DESIGN
3.2 POPULATATION
OF THE STUDY
3.3 SAMPLES/SAMPLE
TECHNIQUES
3.4 METHOD
OF DATA COLLECTION
3.5 DATA
ANAYSIS TECHNIQUES
CHAPTER FOUR
4.0 PRESENTATION
AND ANALYSIS OF DATA
4.1 INTRODUCTION
CHAPTER FIVE
5.1 SUMMARY
OF FINDINGS
5.2 CONCLUSION
5.3 RECOMMENDATIONS
BIBLIOGRAPHY
APPENDIX
CHAPTER ONE
INTRODUCTION
1.3
BACKGROUND OF THE STUDY
The
issue of sustainable development in the third world countries like Nigeria has
been a growing concern to both the government and the private sector. The huge
amount of money the government has been
investing on this platform over the years have not yielded any meaningful
result. Poverty is a characteristic OF Nigeria households or individuals. It
has been realized in the recent years that there are limits to which government
can single promote development. Most of the traditional functions being carried
out by the government in most countries ranging from the provision of economic
development are becoming increasingly difficult to accomplish. Nigeria as an
nation has her own administration, corruption, infrastructural decay,
insecurity of lives and properties, unstable macroeconomic regime and
unpredictable fiscal policies by successive administration (Fasug, 2006).
Thus,
both the public and the private sector of the economy and every segment of the
society process of the country. It is on this basis that government begins to
engage in privatization policy with the view of allowing the private sector to
participate in the economic development of the nation, consequently, various
government process of the country’s economy.
One
of the response to the challenges of development in the developing countries is
the encouragement of the entrepreneurial development sachem. Nigeria had even
taken more robust step by including entrepreneur studies in the academic
curriculum of her educational system. the believe of such policy makes is that
such decision will inculcate entrepreneur spirit in the mind of people so as to prepare them for
wealth creation through small enterprises (Fasua, 2006).
A
small scale enterprise is very crucial to the development, a
Of a
country’s economy, especially countries like Nigeria. Entrepreneurship is sine
qua non to national development, poverty eradication and employment general. It
is the bedrock of any nations industrialization. A number of studies have been
carried out on the impact of microfinance on entrepreneurial development. In
fact, academic interest shows the impact of microfinance on entrepreneurial
development is evidenced by the fact that some academic journals have devoted
special issues to research establishing this linkage.
According
to Amin, Rai and Topa (2003) focus their article on the ability of microfinance
to reach the poor and vulnerable. They focus their article in such a manner
because of concerns that microfinance is only serving people slightly below or
above the line of poverty, however the really poor and destitute are being
systematically excluded.
Thus,
the question of whether microfinance improves or worsens entrepreneurial development is still worthy of further
research such as the one being undertaken in this study.
1.4 STATEMENT OF THE PROBLEM
In
any country of the world, microfinance helps in the development of the country
by granting loans to low income earners. According to copestake, halotra and
Johnson (2001) analyza the impact of microfinance on firms and individual
welling. Copestake at all focus on business performance and household income to
establish a link between the availability of the time, it appeared that
microfinance are not financing to the poor and business client. The research
went forward to research the problems of this study which are:
ü Inability
to encourage the development of new business.
ü Inability
to help existing business grow or diversity their activities
ü Low
rate of employment
ü Inability
to create employment and income opportunities through the creation and expansion
of micro enterprises.
ü Inability
to increase the productivity and income of vulnerable group especially and the
poor.
ü High
rate of poverty
ü Economic
dependence on foreign countries.
I.3 OBJECTIVE OF THE STUDY
The
objective of micro-finance to entrepreneurial development made the central bank
of Nigeria adopted it as the main source of financing entrepreurship in
Nigeria.
Despite
this, however, finance is still considered as one of the major hindrance to
entrepreneurial development in Nigeria. While government and non government
organization (NGOS) have been engaging a number of programmes in the county.
They specific objectives of this study is,
i.
Examine the importance of entrepreneurial
activates to the sustainable development of entrepreneurship in Nigeria.
ii.
Examine the impact of microfinance
institution on entrepreneurial.
iii.
Examine the challenges of accessibility to
capital for the development of entrepreneurship in Nigeria.
iv.
Create the awareness of the importance of
microfinance institution to entrepreneurship development in Nigeria.
1.10
RESEARCH
QUESTIONS
In
order to achieve the above stated objectives, the following research questions
are advanced
A. Does microfinance
contribute to entrepreneurial activities that can lead to sustainable development
in Nigeria.
B: Do entrepreneurs have
access to capital for the development of small and medium size entrepreneurship
in Nigeria?
C: What are the
prospects of microfinance in the development of entrepreneurship in Nigeria?
1.11
RESEARCH
HYPOTHESIS
v Do
entrepreneurial development have any implication on the in development of Nigeria? The
following null hypothesis are proposed and tested in the cause of this study.
v There
is no significant difference between entrepreneurs who use microfinance and
those who do not.
v There
is no significant effect of microfinance institution activities in predicting
entrepreneurial productivity.
v There
is no significant effect of microfinance institutions activities in predicting
entrepreneurial development.
1.12
SIGNIFICANCE
OF THE STUDY
The
important of microfinance to the entrepreneurial development made the central
bank of Nigeria adopted it as main source of financing entrepreneurship in
Nigeria.
The
significance of this study is to:
i.
Microfinance help in the provision of
financial service to low-income, poor and very poor self employed people (Otero
2000).
ii.
Microfinance has the ability to strengthen
micro enterprise best practice among operators of small and medium scale
enterprise.
iii.
The microfinance help to provide financial
service to low income client including the self employed.
1.13
SCOPE
/ DELIMATION OF THE STUDY
The study would focus extensively on the
impact of banks on entrepreneurial development of small, medium and large scale
enterprises but focuses on small scale enterprises but focuses on growth and
development in a stiffened economy of Nigeria.
The
spread between the parallel and official of microfinance banks shall also be
examined with the view of identifying the factors, responsibilities for the
difference. And how it’s contributed to the growth of the country.
This
study covers commercial places, sites, business environments, towns and cities
in different states but focus extensively in Lagos state.
1.14
LIMITATION
OF THE STUDY
Limitation
is said to be the potential weakness if the study, that is to said, those
attributed and difficult circumstance or challenges you find uneasy when
writing up the project.
The
weakness of the study arises as a result of certain factors encountered at
several level of the exercise, such limitation includes
1.
FINANCIAL AND MATERIAL LIMITATION: This
limitation arises due to insufficient finances to going to some micro finance
banks in Lagos state, in other to get vital information from our respondents.
2.
THE SMALLNESS OF THE SAMPLE AS COMPARED TO
THE ENTIRE POPULATION: It should be pointed out that limited resources to carry
out the researchers disposal could not permit or allow for a greater sample
size.
3.
LACK OF CO-OPERATION FROM OUR RESPONDENTS:
This limitation arises because of insufficient information from our respondents
due to lack of co-operation from them.
4.
UNNECESSARY BOTTLEVENECK MATTERS: for we to
get to the bank for the materials, we had to pass through procedure that are
not necessary, like signing of a document, going to one counter the other,
please we are busy the management doesn’t want to see anybody. This becomes
cumbersome.
1.15
DEFINITION
OF TERMS
Microfinance
has evolved as a economic development approach intended to benefits low income
men and women. The term refers to the provision of financial services generally
includes savings and credit. However, some microfinance institutions also
provide insurance and employment services.
ENTREPRENEUR:
An entrepreneur is people sho owns an enterprise or organization and also
control and manage the affairs and activities of the business.
An
entrepreneur can be said to be sole trader or sole proprietorship of a
business. He or she runs the day to day activities of the business.
LOAN:
Loans are said to be long term debit issued to business client by the financial
institution to be paid back with interest at the specific period using
collateral as security.
COLLATERAL:
This is the property a borrower is willing to pledge to the banks as a
secondary source of payment, should the first source (income and profit) dry up
securities for bank lending according to Nzoha (1999). Security in this
direction is a right or interest in property given to a creditor by a debtors
so that is event of the debtor fairing to pay its is event of the debtor as
when due, the creditor may reimburse himself for the debt out of the property
changed.
PLEADING
:Pleading entitles the creditor exclusive possession of (the property until the
pledge repays a debt white ownership risk with the debtor subject to the
exercise of his right.
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