Does Bank Loans Crowd-out Small and Medium Scale Enterprises? A Case of Nigeria

Abstract

The main purpose of this paper is to investigate the extent to which deposit money bank loans  crowds-out deposit money bank loans to small and medium scale enterprises (SMEs) in Nigeria using regression model on data from January 2007 to March 2013. The results provide evidence to show that deposit money bank loans to small and medium scale enterprises are not significant in relation to total deposit money bank loans in Nigeria. The implication is for the money authorities to provide incentives to encourage SMEs funding in Nigeria, as no economy achieves sustainable development without vibrant SMEs.

Keywords: Small scale enterprises, Large scale enterprises banking sector credit, regression model, Nigeria