ABSTRACT

This study was carried out in order to understand the significance of equipment leasing as well as its challenges and benefits to small businesses. It was necessitated by the researcher's interest in finding out the prevailing perceptions and realities of leasing as it concerns small businesses. The main objectives of the project are: - to find out the benefits of leasing over other asset financing options, to investigate the reasons behind the seeming indiflrence of small businesses to leasing, to uncover issues that small businesses should be concerned about while considering the lease option etc. The primary data for the research were collected using a questionnaire distributed to management personnel of a sample of 80 small businesses selected by non-probability sampling method. In addition to this, personal interviews were used to elucidate and support the questionnaire responses. The secondary data were sourced from internet articles and published texts. te data were presented and analysed by means of simple frequency tables, array rankings, percentages and prop0rtio1s, as well as pie and bar charts. The major results obtained show that: - interest of small businesses in equipment leasing has been on the rise in preference to other sources of equipment financing. However, popularity was found to be prompted primarily by internal constraints such as high equipment costs and seasonal nature of equipment needs rather than external influences. It was further discovered that exorbitant lease premium along with several risks and difficulties identified by respondents were discouraging additional interest in leasing equipment. and that favourable pricing, purchase terms and value-enhancing services by lessors would go a long way to satisfy the small business lessee. Finally, the researcher encouraged government to speed up efforts on enacting a leasing law, plus policies nurturing of small businesses; suggested the idea of establishing a leasing bank to the central bank; and lastly pleaded with the entire business community to embrace healthy and socially responsible ethics.