Deposit Money Bank Credit to Small and Medium Scale Enterprises (SMEs): A focus on wholesale and retail trade.
Keywords:
Bank credit, Deposit money bank, small and medium enterprises, TradeAbstract
The study investigated the effect of deposit money bank credit to SMEs in Nigeria: focus on wholesale and retail trade, the study used secondary data covering the period 2010 to 2023 and the Central Bank of Nigeria's (CBN) 2023 Statistical Bulletin was the source of the data used in the study. The study applied the dynamic OLS technique for the model, and econometric techniques was used for the data analyses are descriptive statistics, person correlation coefficient, unit root test, post regression test and Q-statistics. The study found that deposit money banks’ credit to SMEs exhibit a positive and significant impact on wholesale and retail trade. Result from lending interest rate (LINTR) and inflation rate (INFR) have a negative and significant impact on wholesale and retail trade (WRT) whereas, broad money supply (BMS) exhibit positive significant impact on wholesale and retail trade (WRT), the study concluded that, deposit money bank credit to SMEs has positive significant impact on wholesale and retail trade in Nigeria during the period of study. Therefore, it is recommended that government policy makers should revamp the financial system and the government should prioritize credit creation to wholesale and retail trade in order to improve performance of the SMEs.