IMPACT OF SMALL SCALE ENTERPRISES IN DEVELOPMENT OF KWARA STATE

Abstract

Small and Medium Scale Enterprises (SMEs) has proved to be a major intervention in resolving the problems of poverty and unemployment in most developing countries. This study examines the impact of SMEs on Economic Development of Kwara State (2008-2015). A survey research design was adopted to obtain data from 150 respondents comprising of traders, artisans, production factories and other small and medium enterprises which were selected using multi stage sampling method across 16 local govemment areas in Kwara State. Two Null hypotheses were tested to identify the significant effects of Small and Medium Scale Enterprises on poverty reduction, employment generation and improvement in the standard of living in Kwara State. Data for this study was analyzed using Chi-square at 0.05 level of significance was used to test the hypotheses with the aid of Statistical Package for Social Sciences (SPSS). The findings revealed that there is a positive and significant relationship between SMEs and poverty reduction, employment generation and improvement in standard of living of people in Kwara State. Furthermore, the result revealed that there was a 57% increase in the number of SMEs in the State between the years 2008-2015. The study concludes that access to capital funding by reduction in the interest rate on loan offered by banks can boost the performance of SMEs in Kwara State and Nigeria at large. The study therefore recommend that the government should provide more capital funding to the young ones who present viable business ideas in order to reduce the rate of unemployment in Nigeria and as well, Nigeria banks should encourage the development of SMEs through reductions in the interest / changes or loan.