ABSTRACT

 This study deals on the "Empirical Analysis of the funding of Small and Medium Scale Enterprises in Abia State" (A case of Selected Cassava Processing Enterprises in Abia State).The board objective of this study is to examine the Funding of Small and Medium Scale Enterprises in Nigeria with special reference in Abia State. The specific objectives are: (i) To identify and analyze the socio-economic characteristics of the entrepreneurs. (ii) To identify and analyze the various sources of funds to SMEs in the Area. (iii) To estimate and analyze the determinants of working capital of the entrepreneurs. (iv) To identify the various problems facing SMEs. (v) To make policy recommendations based on findings. The three agricultural zones of Abia State viz: Bende, Umuahia and Aba were selected for sample selection. Questionnaires were distributed to the respondents and 90 were returned and used for the analysis. Objective (i), (ii) and (iv) were analyze using simple descriptive statistics. While objective (iii) was analyze using multiple regression analysis. Some of the findings of this study were that majority of the respondents (60%) are females, the result of the multiple regression analysis showed that the coefficients of Age, Years in business and Value of assets were positively and significantly related to working capital at 1% level of probability. Implying that any increase in these variables would lead to a corresponding increase in the working capital. The socio-economic characteristics of the entrepreneurs both have positive and negative effects towards working capital. Some of the major problems faced by the respondents in the study area were — poor finance, perish ability of the produce, lack of storage facilities, High cost of transportation, High cost of fuel, and bad road network. Some of the recommendations made by the study include: construction of motor able roads in the rural areas were these produce were bought, provision of finance and storage facilities, provision of adequate infrastructure, Loans should be extended to the entrepreneurs at a low rate. Policies should be aimed at encouraging those who are experienced to remain in cassava processing. The government should monitor the enterprises especially cassava processing enterprise who are hardworking and encourage them by making flow of funds attainable to them. Individuals who are well to do should also help finance small and medium scale enterprises. The entrepreneurs on their own should form a cooperative society where they can save their money together and loan will be given to any member who need it at a reduced interest rate. Among other recommendations.ba