Cooperative society credit scheme and performance of small and medium enterprises in Oyo State, Nigeria
The study examined other various sources of funds available to SMEs in Oyo State; analyzed the effects of cooperative societies’ credit scheme on SMEs performance in the State; and analyzed the challenges associated with cooperative society credit scheme in Oyo State. These were with a view to highlight the roles of cooperative societies in the development and growth of Small and Medium Enterprises in Oyo State. Primary and secondary data were used for this study. Structured questionnaire was used to capture the primary data while secondary data was obtained from the annual financial reports of cooperative societies. The study purposively selected the total number of 150 owners of SMEs that are members of registered cooperative society from the three senatorial districts in the study area. 150 questionnaires were administered but 123 were returned which represents 82% response rate. In–depth interview was also conducted on the few selected respondents. Data obtained were analyzed using ordinary least square and simple percentages. The results showed that the other sources of fund available to SMEs were commercial bank loan, trade credit, family fund, government intervention fund and fund from relatives (21%), aside from cooperative loan (66%) and personal savings (13%). The result also indicated that cooperative society credit scheme has a significant effect on SMEs on return on asset (t=3.71, p<0.01); meaning that there is positive effect credit scheme on the performance. Lastly, major challenge being encountered by the respondents is the restriction on the amount of money the SMEs owners could access from the cooperative society which is depicted by 91% of the respondents while other challenges are short repayment period and queuing for loan due to insufficient fund (9%). The study concluded that cooperative society credit scheme have significant effect on the performance of Small and Medium Enterprises in Oyo State.