THE ROLE OF MICROFINANCE BANKS IN THE GROWTH AND DEVELOPMENT OF SMALL AND MEDIUM ENTERPRISES IN NIGERIA (CASE STUDY OF NWANNEGADI MICROFINANCE BANK ORLU)

In Nigeria, credit has been recognized as an essential tool for promoting
Small and Micro Enterprises (SMEs). The Federal of state governments
have recognized that for sustainable growth and development, the financial
empowerment of the rural areas is vital, being the repository of the
predominantly poor in society and in particular the SMEs. To give effect to
theses aspirations, various policies and programmes have been instituted
overtime by the federal government to improve rural enterprise production
capabilities such as Agricultural Development Projects (ADP), the
establishment of Agricultural credit banks to better life programme for rural
women and achieve the desired results due to poor capitalization. This and
development of Small and Medium Enterprises (SMEs) in Nigeria. Primary
and Secondary sources of data collection, were used in collecting data for
this research work. Sample size of 50 was used for the research which was
drawn from the staff of Nwannegadi microfinance Bank Orlu and some
SMEs in Orlu. Chi-square was used in testing the hypothesis. The findings
indicate that microfinance banks have positive impact in enhancing service
delivery of Small and Medium enterprises in Nigeria. For effective delivery,
it is recommended that SMEs funds should utilized effectively and the CBN
and NDIC should make extensive campaigns on the safety of microfinance
banks to the public. Conclusively, microfinance banks can be used to
cause transformation in rural areas.