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Traditional Financial Institutions and Rural Enterprises in Nigeria: The Case of Ogoni Land

Author

Listed:
  • Ettah, Bassey E.
  • Onye, Kenneth U.
  • Daasi, Gibson L.K.

Abstract

This paper examines the role of the traditional financial institutions (TFIs) in the development of micro and small scale enterprises (MSEs) in Ogoni land. The methodology adopted for the study is based on the Paired Observation Test (POT). By adopting an empirical analysis of field data, the paper sought to ascertain the role of some forms of TFIs (the Osusu scheme) in the growth and development of MSEs. The assessment is based on analysis of the involvement of MSEs operators in the Osusu scheme, their total turnover on investments and number of people employed after six years of involvement in the scheme. It also reviews the strengths and challenges of the system in Ogoni and offers some suggestions for strengthening it. Relying on the paired observation test, the results of the study indicates that TFIs generally contributes to the development of the MSEs in Ogoni. However, the Osusu system favours the development of organized MSEs than unorganized MSEs. The study identifies self-regulation as the major setback on the efficacy of TFIs in fostering the growth of MSEs in Ogoni and recommends a system of regulation that may replicate that of the Association of Micro-finance Banks of Nigeria. Increased awareness, periodic supervision and monitoring of the activities of the TFIs are also recommended.

Suggested Citation

  • Ettah, Bassey E. & Onye, Kenneth U. & Daasi, Gibson L.K., 2012. "Traditional Financial Institutions and Rural Enterprises in Nigeria: The Case of Ogoni Land," MPRA Paper 88396, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:88396
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    References listed on IDEAS

    as
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    2. Miracle, Marvin P & Miracle, Diane S & Cohen, Laurie, 1980. "Informal Savings Mobilization in Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 28(4), pages 701-724, July.
    3. Mead, Donald C. & Liedholm, Carl, 1998. "The dynamics of micro and small enterprises in developing countries," World Development, Elsevier, vol. 26(1), pages 61-74, January.
    4. Aryeetey, Ernest, et al, 1997. "Financial Market Fragmentation and Reforms in Ghana, Malawi, Nigeria, and Tanzania," The World Bank Economic Review, World Bank, vol. 11(2), pages 195-218, May.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Traditional Financial Institutions; Micro and Small Scale Enterprises; Ogoni land; Paired Observation Test;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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