Determinants of Access to Entrepreneurial Credit: Examining Women Entrepreneurs in Sokoto State, Nigeria

Abstract

This study was carried out to examine the determinants of women entrepreneurs’ access to credit in Sokoto State of Nigeria. Primary data were obtained from a sample of 343 women entrepreneurs via questionnaire and analysed using binary logistic regression. Out of the seven factors investigated, only five were found to influence women entrepreneurs’ access to credit in Sokoto State. These are cost of credit, collateral security, level of education, awareness of credit opportunities, and rigid terms and conditions. The other two, namely, credit union membership and proximity of credit facility were not found to influence women entrepreneurs’ access to credit in Sokoto State. Results showed that level of education and awareness of credit opportunities were positively related to women entrepreneurs’ access to credit whereas cost of credit, collateral security and rigid terms and conditions were negatively correlated with women entrepreneurs’ access to credit. Findings suggest that microfinance institutions and other sources of credit facilities should reduce the cost of credit and the demand for collateral security as well as simplify the prevailing rigid terms and conditions so that women entrepreneurs in Sokoto State can access credit. Awareness of credit opportunities should be raised and women entrepreneurs should also be encouraged to improve their level of education in Sokoto State in order to leverage the credit faculties available to them. Moreover, policy makers and relevant stakeholders have the responsibility to make informed decisions to positively address the determinants identified in this paper.

Keywords: Access to Credit, Women Entrepreneurs, Logistic Regression, Sokoto State, Determinants

DOI: 10.7176/EJBM/11-8-12

Publication date:March 31^st 2019