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Credit access and the performance of non-farm household enterprises: evidence from Nigerian data

Author

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  • Obed I. Ojonta
  • Jonathan E. Ogbuabor

Abstract

Inadequate availability of credit access is one of the major problems facing household enterprises in developing countries, especially Nigeria. Despite various government interventions aimed at solving this problem, it is still perceived that credit access is a serious challenge facing these enterprises in Nigeria. Hence, this study examined the impact of credit access on the performance of total stock of input supply of non-farm household enterprises in Nigeria. Unlike the bulk of existing studies, we employed multinomial logit regression and used the 2018 General Household Survey data. The stylised facts from the data revealed that non-farm household enterprises in urban areas have greater access to credit than their counterparts in rural areas. Interestingly, the findings indicate that even though a large chunk of the non-farm household enterprises in our sample face the challenge of access to credit, credit access nonetheless impacts significantly and positively on total stock of input supply of non-farm household enterprise in Nigeria. Among others, we recommended that credits to non-farm household enterprises should be adequately monitored not only to enhance the performance of these enterprises but also to ensure that the funds are not diverted to other uses.

Suggested Citation

  • Obed I. Ojonta & Jonathan E. Ogbuabor, 2021. "Credit access and the performance of non-farm household enterprises: evidence from Nigerian data," International Journal of Sustainable Economy, Inderscience Enterprises Ltd, vol. 13(1), pages 72-86.
    • Handle: RePEc:ids:ijsuse:v:13:y:2021:i:1:p:72-86
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    Citations

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    Cited by:

    1. Edith C. Obiefuna & Obed I. Ojonta & Jonathan E. Ogbuabor, 2024. "The influence of COVID-19 pandemic and coping strategies on work operation of nonfarm household enterprises in Nigeria," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(6), pages 13595-13610, June.
    2. Obed I. Ojonta & Jonathan E. Ogbuabor & Edith C. Obiefuna, 2024. "Impact of Employment on Access to Credit of Non-agricultural Household Enterprises in Nigeria," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 17556-17578, December.
    3. Subrata Saha & Mohammad Jahangir Alam & Al Amin Al Abbasi & Ismat Ara Begum & Maria Fay Rola-Rubzen & Panam Parikh & Andrew M. McKenzie, 2025. "Can credit promote rural transformation? Evidence from district-level data in Bangladesh," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-10, December.
    4. Edith C. Obiefuna & Obed I. Ojonta & Jonathan E. Ogbuabor, 2023. "Impact of Employment on Access to Credit of Non-Agricultural Household Enterprises in Nigeria," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 13(3), pages 96-112.
    5. Obed I. Ojonta & Divine N. Obodoechi & Paschaline N. Ugwu, 2021. "Start-up Capital Source and Credit Access Participation of Household Nonfarm Enterprises in Nigeria: Evidence from Logistic Regression Model," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 19(3 (Fall)), pages 249-267.

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