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Microfinance and Entrepreneurship in Nigeria: A Macro Analysis

Microfinance and Entrepreneurship in Nigeria: A Macro Analysis

Babajide Abiola Ayopo, Lawal Adedoyin Isola, Taiwo Joseph Niyan, Akinjare Victoria Bosede
Copyright: © 2018 |Pages: 20
ISBN13: 9781522552130|ISBN10: 1522552138|EISBN13: 9781522552147
DOI: 10.4018/978-1-5225-5213-0.ch004
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MLA

Ayopo, Babajide Abiola, et al. "Microfinance and Entrepreneurship in Nigeria: A Macro Analysis." Microfinance and Its Impact on Entrepreneurial Development, Sustainability, and Inclusive Growth, edited by Ramesh Chandra Das, IGI Global, 2018, pp. 65-84. https://doi.org/10.4018/978-1-5225-5213-0.ch004

APA

Ayopo, B. A., Isola, L. A., Niyan, T. J., & Bosede, A. V. (2018). Microfinance and Entrepreneurship in Nigeria: A Macro Analysis. In R. Das (Ed.), Microfinance and Its Impact on Entrepreneurial Development, Sustainability, and Inclusive Growth (pp. 65-84). IGI Global. https://doi.org/10.4018/978-1-5225-5213-0.ch004

Chicago

Ayopo, Babajide Abiola, et al. "Microfinance and Entrepreneurship in Nigeria: A Macro Analysis." In Microfinance and Its Impact on Entrepreneurial Development, Sustainability, and Inclusive Growth, edited by Ramesh Chandra Das, 65-84. Hershey, PA: IGI Global, 2018. https://doi.org/10.4018/978-1-5225-5213-0.ch004

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Abstract

Microfinance banks were established to provide diversified, affordable, and dependable financial services to the active poor that would enable them to undertake and develop long-term, sustainable entrepreneurial activities to create employment opportunities, increase their productivity, and thereby increase household's income and standard of living. This chapter employed ordinary least square and vector error correction estimation techniques to establish the contribution and long-run relationship of microfinance to entrepreneurship development in Nigeria for the period 1992-2015. The result shows that a positive significant relationship exists between microfinance gross loan portfolio, total deposit liability, and entrepreneurship proxied by number of newly registered business, while a negative significant relationship exists between microfinance bank asset and entrepreneurship. This therefore suggests that availability of loanable funds for micro and small-scale enterprises provided significant support for entrepreneurship development in Nigeria. The result also shows that a long-run relationship exists between microfinance variables and entrepreneurship in Nigeria. The study therefore recommends that microfinance banks should improve on the quality of their asset by reducing non-performing loans.

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