Informal financial institutions and growth of small and medium scale enterprises in Abeokuta south, Ogun state, Nigeria. Ajagbe, F. A., Adegbite, D. O., &Oladejo, D. A.


This paper examined the influence of informal financial institutions on small and medium scale enterprises growth in Abeokuta South, Ogun State, Nigeria. The study used money lenders, cooperative society, ROSCAs and daily savings as proxies of informal financial institutions. The study utilized a structured questionnaire to collect primary data from a total of 129 respondents. Descriptive statistics was used to analyze the demographics of the respondents, while the multiple regression statistic was used to test for the influence of the explanatory variable on the outcome variable; with the help of STATA 11.0. The study found that informal financial institution (money lenders, cooperative society, ROSCAs and daily savings) have positive and statistically significant influence on growth of SMEs in the study area. Thus, the study recommends that operators of SMEs in Abeokuta south that crave growth should leverage the opportunities provided by informal financial institutions to access funding with more favourable conditions.

Keywords: Cooperative societies, informal financial Institutions, money lenders, SMEs growth, ROSCAs

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