The effect of Government monetary policy on credit accessibility and growth of small and medium-sized enterprises (SMEs) in Obio-Akpor, Rivers State

Abstract

This study investigates the impact of government monetary policy on the growth of Small and Medium-sized Enterprises (SMEs) in Obio-Akpor Local Government Area of Rivers State, with particular emphasis on credit accessibility, financial stability, and enterprise development. The research focused on SMEs operating in Mgbuesilaru, Rumuoji, Elelenwo, Rumuekwe, Rumuobochi, and Nkpa. Primary data were obtained from 120 SME operators across various sectors, drawn from 280 distributed questionnaires. The findings indicate that SMEs face considerable difficulties in accessing credit, largely due to stringent loan conditions and high collateral requirements. Moreover, while government monetary policies have a moderate influence on the financial stability of SMEs, their overall effectiveness in stimulating business growth remains limited. The study recommends the introduction of more flexible lending terms, including reduced interest rates and extended repayment periods, to alleviate financial constraints and enhance the sustainability of SMEs.