Reviving Small and Medium Enterprises in Onitsha through Microcredit Financing: Eradicating abject Poverty in Nigeria.

Abstract

Small and medium-scale enterprises (SMEs) play a significant role in the economies of developing nations, contributing to self-employment and poverty reduction. This study investigates the relationship between microcredit financing and SMEs in Nigeria, focusing on its potential to alleviate poverty. The research utilized a cross-sectional survey design to collect data from entrepreneurs in the Onitsha main market, specifically examining their engagement with microcredit from nearby financial institutions. The study is based on the life cycle theory, which outlines the dynamics between microcredit lenders and SMEs. A total of six hundred entrepreneurs operating shop outlets in the Onitsha main market were surveyed. The findings indicate a strong association between revolving credit and installment credit facilities and the success of SMEs. Based on these results, the study recommends the establishment of an enabling environment for SMEs, emphasizing the need to sensitize entrepreneurs and improve access to credit facilities to support the sustainability and growth of these enterprises.