Assessment of the Role of Micro-Finance Banks in Business Development in Adamawa State

Abstract

Establishment of Micro-finance banks as an effort by the government to improve the access to loans and savings services for poor people is promoted as a key strategy to develop businesses at the grassroots and develop the economy ultimately. Many microfinance programmes have been established in Nigeria to provide financial and non-financial services in order to render support services to the Small and Medium Entreprises. However, some of the challenges currently are associated with problems of access to microfinance institutions, their system of operations and conditions with regard to obtaining credit facility, and poor managerial skills on the part of business owners. The study examines the role of microfinance banks in developing business in Nigeria as well as proffer solutions to challenges of SMEs to aid the development of business and Nigerian economy. A survey was conducted among SMEs and microfinance banks within Adamawa. The analysis of data was carried out using a chi-square test analysis SPS. It was concluded that microfinance banks have significant impact on business development.