IMPACT OF ISLAMIC BANKS’ CREDITS ON THE PROFIT OF SMALL AND MEDIUM ENTERPRISES IN YOLA METROPOLIS
Aminu Dahiru and Adewusi Olusegun Adegoke
Volume 4 Issue 2
Abstract
This study examined the impact of Islamic Banks’ credits on small and medium enterprises in Yola metropolis, Adamawa State Nigeria. The study employed the use of primary data collected using five Linkert scale questioner from 119 operators of small and medium enterprises across different sectors of the economy in Yola Metropolis. The data were analyzed using Structural Equation Model (SEM) technique. The results suggested that Islamic banks credits positively influence the profitability of small and medium enterprises in Yola Metropolis. Based on the findings, adopting asset-based credits from the Islamic banks by the Small and Medium Entrepreneurs in Yola metropolis can improve the performance their businesses and save them from the adverse effect interest-based (loan) financing. The Islamic banks should look inward and develop simplified credit products improve access of Islamic credits by small and medium enterprises in Yola metropolis in order expand the scope of the impact Islamic banks. Government needs to partner with the Islamic credits in supporting the small and medium enterprises by providing credit guarantee covers to that are SMEs duly registered and capable of repaying the credits advanced to them. Keywords: Islamic Bank, Credit, Small and Medium Enterprises
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