IJCRR

IJCRR - 4(21), November, 2012

Pages: 01-16

Date of Publication: 15-Nov-2012

TRADITIONAL FINANCIAL INSTITUTIONS AND RURAL ENTERPRISES IN NIGERIA: THE CASE OF OGONI LAND

Author: Ettah B. Essien, Onye Kenneth Ugwu, Daasi, Gibson L. K.

Category: General Sciences

Abstract:This paper examines the role of the traditional financial institutions (TFIs) in the development of micro and small scale enterprises (MSEs) in Ogoni land. The methodology adopted for the study is based on the Paired Observation Test (POT). By adopting an empirical analysis of field data, the paper sought to ascertain the role of some forms of TFIs (the Osusu scheme) in the growth and development of MSEs. The assessment is based on analysis of the involvement of MSEs operators in the Osusu scheme, their total turnover on investments and number of people employed after six years of involvement in the scheme. It also reviews the strengths and challenges of the system in Ogoni and offers some suggestions for strengthening it. Relying on the paired observation test, the results of the study indicates that TFIs generally contributes to the development of the MSEs in Ogoni. However, the Osusu system favours the development of organized MSEs than unorganized MSEs. The study identifies self-regulation as the major setback on the efficacy of TFIs in fostering the growth of MSEs in Ogoni and recommends a system of regulation that may replicate that of the Association of Micro-finance Banks of Nigeria. Increased awareness, periodic supervision and monitoring of the activities of the TFIs are also recommended.

Keywords: Traditional Financial Institutions, Micro and Small Scale Enterprises, Ogoni land, Paired Observation Test

Full Text:

INTRODUCTION
The informal or traditional financial institutions and traditional credit groups were originally the institutions or agencies to finance farmers, micro and small scale enterprises (MSEs) and business men. Today, the TFIs still exist and dominate large and greater part of rural areas of Nigeria. Traditional financial institution is a kind of cooperative which consist of people who agree to contribute a certain sum of money each and hand it over to a member of the group or share among themselves periodically. As we see in Nwikina (2000), „Financial Institution? per se simply refers to an agency that collects money from savers and lend to borrowers. According to Akpakpan (1991), finance is simply concerned with the provision of money when and where it is required. Because the term „traditional? conveys a sense of informality, this study defines traditional financial institutions (TFIs) as informal agencies or organizations that are concerned with the provision of money when and where it is required. These TFIs exist alongside with modern financial institutions and operate in both the rural and urban centers but are dominant in rural areas of Nigeria. With the expansion of the money economy, the traditional financial institutions (TFIs) have not lost their vigor. They have multiplied, both in numbers and diversity. This is due largely to poor patronage of rural dwellers to the modern or formal financial institutions. The poor patronage of the modern financial institutions is because they offer relatively low returns on savings than the informal institutions. No doubt, the role of the TFIs in fostering the growth and development of MSEs possess some economic and institutional challenges. For instance, micro and small scale enterprises have limited access to deposits, credit facilities and other financial support services provided by Formal Financial Institutions (FFIs). This is because on the one hand, the MSEs cannot provide the necessary collateral security demanded by the formal institutions and on the other hand, the banks find it difficult to recover the high cost involved in dealing with small firms. In addition, the associated risks involved in lending to MSEs make it unattractive to the banks to deal with them (Aryeetey, 1998). Thus, the frustration of assessing credit facilities from the formal or modern financial systems compels the informal enterprises to resort to different non-banking and informal arrangement, namely the TFIs, to access fund for their business operations. This has serious implications for a country like Nigeria where the economy is largely characterized by Micro and Small Scale Enterprises (MSEs). It implies that informal financing should be a matter of concern when considering the issue of rural enterprises development. This brings to the fore the importance of TFIs, particularly the Osusu scheme, in the growth and development of MSEs. The objective of this paper is to examine the role of the traditional financial institutions, namely, the Osusu scheme, in the development of MSEs in Ogoni using some selected MSEs and Osusu Operators (OOs). In doing this, the paper attempts to investigate the significance of four types of the TFIs to the development of MSEs in four Local Government Areas (L.G.As) of Ogoni land, namely: Gokana, Khana, Tai and Eleme local government areas. Thus, the paper seeks to ascertain the effects of selected types of TFIs on the development of MSEs by assessing their Total Turnover on Investment (TTI) and the number of people employed after six years of involvement in the Osusu scheme. It further tries to ascertain the strengths and challenges of the TFIs and to offer some suggestions for strengthening the system. The balance of the paper is structured as follows. Section 2 provides an eclectic review of theoretical issues on MSEs financing, and the operational definitions of TFIs and MSEs. Section 3 describes the TFIs in Ogoni Land, their functions and impact on MSEs, the field data set, the study tools and explains the methodology used in the empirical tests. Section 4 contains the results of the study. The paper is concluded in Section 5 with policy-oriented suggestions. Operational Hypothesis The following null hypothesis is stated to guide the study. Ho: The change in number of employees and total turnover on investment after 6 years of involvement on any form of TFI is not significantly different from zero. Theoretical Issues in MSEs Financing In recognition of the importance of MSEs in rural development, there has been a deep interest in recent years for development of small business firms particularly since 1986 when Nigeria adoption of the structural adjustment programme. The MSEs is now seen as a key to Nigeria's growth, alleviation of poverty and unemployment. Therefore, promotion of such enterprises in developing economies like Nigeria is of paramount importance because of its great potentials for incomes redistribution, wealth creation, economic self-dependence, entrepreneurial development, employment generation and a host of other positive, economic uplifting factors (Aremu, 2004). There is a general believes that the desired employment generation in this country can be achieved through the development of micro and small scale enterprises (Awosika, 1997; Schmitz, 1995). It has been estimated that MSE?s employ 22% of the adult population in developing countries (Daniels and Ngwira, 1993; Fissaeha, 1991). Despite the potentials of MSEs in launching the country on the path of economic prosperity, recent studies have shown that most MSEs in Nigeria die within their first five years of existence (Aremu and Adeyemi, 2011). It was also revealed that smaller percentage goes into extinction between the sixth and tenth year while only about five to ten percent of young companies survive, thrive and grow to maturity. Many factors have been identified as likely contributing factors to the premature death. Key among this include insufficient capital, lack of focus, inadequate market research, overconcentration on one or two markets for finished products, lack of succession plan, lack of proper book keeping, among others. But account by Aremu and Adeyemi (2011) points to inadequate access to credit particularly on moderate terms and lack of sound management and accounting practices as the major factors that have negatively affected the growth and development of MSEs in Nigeria. It is, therefore, important that appropriate policies be formulated to encourage, support and regulate the activities of the TFIs so as to enhance their role in financing of small business firms. Operational Definitions Classification of Micro and Small Scale Enterprises (MSEs) The definition of MSEs in this study is based on the United Nations Industrial Development Organization?s (UNIDO) definition for developing countries (UNIDO, 1983) and the classification of enterprises by the Nigerian Industrial Promotion Council (NIPC). In this context, the definition for MSEs is based on the Total Turnover on Investments and number of employees (Osei et al 1993, Elaian, K 1996, Steel and Webster 1990). By this classification, Micro-Enterprise employs less than 5 people with a total (annual) turnover of up to $10,000 equivalent; Small Enterprises employ 5 to 19 people with a total turnover of between $10,000 to $100,000 equivalent and Medium Enterprises employ 20 to 100 people with an annual turnover of above $100,000. Goski et al (2007) and Ekumah and Essel (2003) have also used similar categorization. MSEs have further been classified into „Organized? and „Unorganized? enterprises. According to Mead (1987) in Goski et al (2007), the organized MSEs „are those with paid employees and a registered office and Unorganized MSEs are mainly made up of artisans who work in open spaces, temporary wooden structures, or at home and employ little or in some cases no salaried workers. They rely mostly on family members or apprentices?. The operational definition for Total Turnover on Investment (TTI) is the change between the present value of total revenue an enterprise generates from its investments in assets and the total revenue at the time of joining any Osusu scheme. TTI = Where A0 is the average sales at the point of joining any form of TFI A6 is the average sales after six years joining any form of TFI T0 is total investment at the point of joining any form of TFI T6 is total investment after six years of joining any form of TFI Classification of Traditional Financial Institutions (TFIs) The classification of TFIs used for this study is adapted from the categorization by Basu, Blavy and Yulek (2004) in an IMF working paper. Thus, for the purpose of this study, the TFIs are regrouped as follows: (1) Rotatory Savings and Credit Association (ROSCA): This is a form of TFI whereby a group of people mutually agree to come together and pool their resources together in order to assist themselves in turns. They collect an agreed sum of money at periodic intervals and the total amount is given to a member of the group in succession until each member has duly received the sum. ROSCA is common among people engaged in similar type of job. (2) Fixed Saving and Credit Association (FISCA): Here, members pool the resources (money) together for banking purpose. The amount collected is given to the treasurer who holds it for safe-keeping and who returns the lump sum at the end of an agreed period. Borrowing by members and nonmembers is allowed. (3) Mobile Bankers (MBs) or „Akawo?. In this form of TFI, an individual who is a trader or artisan registers with a MB and receives a card containing the days, weeks and months of the year on which each day?s payment is indicated. The mobile banker collects the daily droppings which are kept in his custody or in the bank. At the end of the agreed period when the droppings are redistributed to the owners, the MB takes a day?s collection as his commission. Akawo is common among petty-traders. (4) Individual Money Lenders (IMLs): The individual money lender may be a retired civil servant or a local merchant. In most cases, the lender knows the potential borrower?s social background up to his family relations before giving out the loans. The borrower indicates during application, the collateral (usually landed property) and in most cases, surrenders this collateral before collecting the loan. In case of default, the lender disposes off or auctions the collateral items. Traditional Financial Institutions in Ogoni Land What Roles Do Traditional Financial Institutions Play in Ogoni? There are basically five important functions carried out by traditional financial institutions. These functions are savings, credit, discounting, development and advisory. i) Savings: The traditional financial institution like the ESUSU (Igbo translation) or TELEGBEE (Ogoni translation) engages in the savings business. In some of these institutions the amount to be saved monthly or periodically is determined by members of the association, members contribute according to their ability. The amount collected constitutes the savings for each member which is paid back to them at the expiration of an agreed period of time. ii) Credit: The traditional financial institutions in Ogoni Land provide credit to their members and MSEs, while interest is charged by some institutions, others provide interest-free credit. In some cases, they demand for collateral, while others merely rely on the integrity of members. iii) Discounting: In the traditional system, like ESUSU or TELETU; a man or woman urgently in need of funds may want to buy the right of another member whose turn is to receive the revolving funds. The seller is however held responsible in any event of default. Any member who purchases another member?s turn discounts his own turn to receive the revolving funds in the future. And the discount rate, (the amount the purchaser pays to purchase another person?s turn) is not fixed; it is usually negotiable. iv) Development: Traditional financial institutions play the role of financiers in most rural areas. They conceive projects, organize their implementation and raise the needed funds for their execution. Town Unions, social clubs and village rural development schemes also undertake basic development plans and projects for the benefits of their towns such as building of schools, provisions of infrastructure-water supply, electricity, construction of road, etc. v) Advisory: Traditional financial institutions also perform advisory function to their members in the areas of marriage, building of house, judicious manner of spending morning, moral behaviour, etc.

How do TFIs affect micro and small scale enterprises in Ogoni Land? In addition to being a financial capital, the TFIs (Osusu Scheme) also serves as a strong social capital base which is an incentive to most members. As part of the focus on customers, Osusu does not only deliver the service at the comfort zone of MSEs in Ogoni Land, it serves as a meeting place for the operators of the MSEs to socialize periodically and as at when required. The benefits derived from the networks of operators of small enterprises working together as is the case in most prominent Osusu schemes (the ROSCA FISCAs, IMLs) cannot be compensated for by the formal banking institutions. These are beneficial packages that formal financial systems cannot offer the MSEs and therefore may not be able to compete with the Osusu system over such small enterprises. Osusu in real concrete situations has gone beyond a financial product to a welfare product where individual members of the group have a sense of belonging and support. The welfare aspect of Osusu in effect is an additional product for MSEs in Ogoni Land. METHODOLOGY Method of Study The methodology adopted for the study is based on the Paired Observation Test, POT (see section 3.3). We draw mainly from Goski, Joshua and Stephen (2007). Thus, the study is based on a cross-sectional survey method with two main components. These include Focus Group Discussions (FGD) and Individual Contacts. The contacts were made through one on one discussion and/or small group discussions by visiting offices and officials of banks involved in the Osusu scheme. A self-developed questionnaire was used for the Focus Group Discussion (see appendix 11). This study classified the TFIs (Osusu scheme) into four categories. As earlier noted, this classification is adapted from the classification by Basu, Blavy and Yulek (2004) in an IMF working paper. These are the ROSCAs, FISCAs, MBs and IMLs. The sample design is based on a multi-phase sampling approach. A purposive sample of each category was drawn based on judgment sampling. The sample frame for the TFIs Operators is made up of the following: ? 5 Rotatory Savings and Credit Associations (ROSCA) ? 7 Fixed Savings and Credit Associations (FISCA) ? 10 Mobile Bankers (MB) ? 4 Individual Money Lender (IML) The lists of contributors (MSEs) that have contributed to the Osusu Scheme for at least six years were compiled from the selected operators of the TFIs. The lists were first stratified into organized and unorganized MSEs and then the systematic sampling technique used to draw the test sample from the list of contributors (MSEs). A follow-up was then made to interact with Contributors using the self-developed questionnaire. Both the organized and unorganized MSEs were sampled from the four local government areas of Ogoni land, namely: Gokana, Khana, Tai and Eleme local government areas. ? Group A: Organized MSEs. These are MSEs with paid employees and a registered office. ? Group B: Unorganized MSEs. These are MSEs that are mainly made up of artisans who work in open spaces, temporary wooden structures, or at home and employ little or in some case no salaried workers. They rely mostly on family members or apprentices. STUDY TOOLS The survey tool include questions covering the number of years of involvement in any Osusu scheme, source of initial capital, total turnover on investments before and after joining any form of TFI, sources of the working capital, and number of employees before and after joining Osusu for at least six years and whether Osusu is the sole source of fund mobilization or savings. The study tool, thus, sought to ascertain how Osusu has contributed to the growth of their businesses based on number of employees and Total Turnover on Investment (See appendix 2). Assumptions of the Study The study is based on the following Assumptions ? That increases in the number of employees reflects growth of a MSEs. ? That increases in Total (annual) Turnover on Investment also reflects growth of a MSEs. ? That the growth and development of the MSEs emanate from their nvolvement and membership of the various forms of TFIs. Technique of Data Analysis The paired observation test (POT) is used to analyze the data with a view to determining the relationship between the involvement of MSEs in any form of TFI, namely, the Osusu scheme for at least six years and the development of the micro and small scale enterprises as regards changes in number of people they employed and the changes in their total turnover on investment. The paired observation test is implemented with the quantitative statistical software known as MedCalc. The program displays the summary statistics of the two samples followed by the mean of the differences between the paired observations, and the standard deviation of these differences, followed by a 95% confidence interval for the mean. (See samples of the results in appendix 1). The decision criteria are that if the calculated Pvalue is less than 0.05 (or the test-statistic falls inside the critical region when compared to the critical/table t-value), the conclusion is that the mean difference between the paired observations is statistically significantly different from zero. In this case, the H0 is rejected (Altman, 1991). DATA ANALYSIS AND INTERPRETATION OF RESULTS A total of 92 micro and small scale enterprises were interviewed. These included thirty seven (37) organized and 55 unorganized MSEs who are mainly artisans, traders, service providers and vocational business operators. The major challenge encountered in gathering and analyzing the data for this study was inadequate book keeping records and knowledge of financial accountability by MSEs. Ascertaining increase in number of employees was however easier than the total turnover on investment. RESULTS The results are categorized into three groups a) Sources of initial and working capital (table 1) b) Analysis of changes in number of employees and total turnover on investment (table 2, 3 and 4) c) Interviews of operators of the Traditional Financial Institutions (ROSCA, FISCA, MB, IML) and Medium and Small Scale Enterprises (organized and unorganized). (see table 5 and 6 in appendix 1)

From the paired observation test, the test statistic for changes in number of employees is 8.799 which fall inside the critical region when it is compared to the table or critical t-statistic of 2.33. Hence, we reject the null hypothesis of no significant difference in the changes in number of employees. In other words, we accept the alternative hypothesis, namely, that the changes in number of employees after six years of involvement in the Osusu scheme is statistically significantly different from zero. The test statistic of 2.24 for the changes in total turnover on investment shows that it is also statistically significant at 5% level of significance. Thus, there is qualified evidence which suggests that there is a relationship between involvement in the traditional financial institutions and the growth and development of MSEs in Nigeria. Further disaggregation of the results from table 2 (the organized and unorganized MSEs) is presented below.

The results from Organized MSEs indicate that the test statistic of 6.05 (for changes in number of employees) falls inside the critical region when it is compared to the critical value of 2.33. Similarly, the test statistic of 3.266 for changes in total turnover on investment falls in the region of rejection when it is compared to the table value of 2.33. These results suggest that, for the organized MSEs, there have been significant changes in the both the number of employees and total turnover on investment after at least six years of involvement in any of the forms of TFIs.

The results from the Unorganized MSEs indicate that the test statistic of 1.824 (for changes in total turnover) falls inside the region of acceptance of Ho because 1.824 < 2.33. This is a pointer to the fact that even after over six years of their involvement in the Osusu scheme, the unorganized MSEs failed to witness any significant change in total turnover on investments. This result is supportive evidence that the Osusu system favours the development of organized MSEs than unorganized MSEs as regards the changes in total turnover on investment. DISCUSSION OF RESULTS The findings from the study suggest that most MSEs rely on the TFIs (the Osusu scheme) through personal savings and remittances from relatives to start their businesses (table 1). About seventy-six percent (76%) of MSEs relied on both Osusu and remittances from relatives (table 1). This comprises of 44.7% support from Osusu and 31.3% support from relatives. Bank loans constituted 4.1%, Customer advances constituted 13.54% while Suppliers? credit constituted 6.25% as source of initial capital. This makes the TFIs the largest contributor as source of initial capital. Osusu and profit injection were the main sources of working capital constituting about 68.6% of working capital though profits contributed a little more than Osusu. The Study brought to the fore the fact that though the TFIs generally contributes to the development of Micro and Small Scale Enterprises (MSEs) in Ogoni, its role in creating income stability, employment and growth is statistically questionable for unorganized SMEs given that their TTI is not statistically significant. However it seems to remain an effective means of raising initial capital and for sustaining most MSEs through periodic contributions to ROSCA, FISCA and MBs. Generally, there was a significant change in the number of employees and total turnover on investment for MSEs involved in any form of TFI for at least six years. However, the difference in turnover observed was accounted for largely by the organized MSEs. This is because while the changes in both the number of employees and total turnover on investment for the organized MSEs were statistically significant, it was not the same in the case of the unorganized MSEs. In the case of the unorganized MSEs (table 4), the result revealed that though there was a significant change in the number of employees, the corresponding change in total turnover on investment was not significant. This raises a number of questions. Are the unorganized MSEs employing beyond the optimal level or their resources being employed inefficiently? Could this factor contribute to the reasons why most SMEs normally collapse after few years? CONCLUSIONS AND RECOMMENDATIONS The implication of the findings from this study is that the Traditional Financial Institution (TFIs) has had positive impact on the growth and development of Micro and Small Scale Enterprise (MSEs). The results indicate that involvement in the informal financial system (the Osusu scheme) favours the development of organized MSEs than the unorganized ones. Generally, the TFIs contribute to fund mobilization and cash injection into the MSEs and acts as a form of insurance for most of these businesses. In addition, the study opines that Osusu is more than a financial product. It is also a social capital. It performs other useful role in fostering social and income stability, growth and employment generation. In the light of the foregoing conclusions, the following suggestions are discernable: i. Policy makers should consider regulating the informal financial sector by enacting appropriate laws, rules and regulations which would guide the Modus Oparadi of the system and ensure that it is sustained. Government as a matter of urgency, should prioritize the MSEs sector by giving it devoted practical and visible attention with a view to making it virile, vibrant, focused and productive. The era of „lip service? attention to the sector should be done away with. The employment creation cannot be developed without a vibrant SMEs subsector, and so government should do all within its arsenal to reverse the situation. ii. To mitigate the obstacles of irregular payments by contributors and loan delinquency, the operators of the Osusu scheme should be involved in appraising customers and recovering loans. In this case a short training in accounting, book keeping and basic business management principles should become a pre-requisite for accepting MSEs into the FISCA and ROSCA scheme since this is where the loan delinquency rate seems higher. Microfinance interventions in terms of access to credit must be tied with basic management training and basic accounting skills. Here the basic requirement for a micro and small scale enterprise (MSE) to access micro finance from the Osusu scheme or government should not be collateral or merely a form of guarantee but ability to groom the enterprise. Since finance is the most important and cogent key of any enterprises, MSEs must be financially supported so that they can take off, expand and be able to meet the needs of the Nigerians. There is also the need to support and strengthen their productive capacities and market competitiveness. This will provide a training ground for indigenous entrepreneur and help in reducing rural-urban drift resulting from lack of job opportunities in the rural area, especially when MSEs are sited in the rural areas. iii. Finally, to enhance the role of TFIs in the development of micro and small scale enterprises, there is need for increased awareness of their importance, proper supervision and periodic monitoring of their activities/operations so as to foster their intermediation role. In advanced economies, the MSE sector is acclaimed as the engine of economic growth and development. However, against international best practices Nigeria is rated poorly. Extensive efforts in terms of strategic programmes, policy and practice will be required to elevate Nigeria to a leading position. Though Nigeria lacks adequate census on relevant economic indices, it is estimated that Small and Medium Enterprises in Nigeria currently account for over 75% of employment in the country (SMEDAN 2006). This relatively high percentage is however a paradox as 60% of Nigerians still lives below the poverty level. When 60 percent living below the poverty line are taken into account, the share of those gainfully employed in the SME sector is more likely to be in the region of 10% as recorded by US Industry Small Business Administration (SBA)

References:

1. Akpakpan, (1991). Economics Beyond Demand and supply. Port Harcourt: New Generation Publishers. 2. Altman, D. G. (1991). Practical statistics for medical research. London: Chapman and Hall. 3. Aremu, M. A. (2004). Small Scale Enterprises: Panacea to Poverty Problem in Nigeria, Journal of Enterprises Development, International Research and Development Institute, Uyo, Akwa Ibom, Nigeria, I(1): 1 – 8.

4. Aremu, M. A., and Adeyemi, S. L. (2011). Small and Medium Scale Enterprises as A Survival Strategy for Employment Generation in Nigeria. Journal of Sustainable Development, 4(1). 5. Awosika, B. O. (1997). Evolving a National Framework for the Emergency of a Strong and Virile Small and Medium Scale Industry SubSector in Nigeria. A Seminar Paper Presented at MAN House, 5th November. 6. Ayertey, E. (1998). Informal Finance Prepared for Private Sector Development in Africa. Background paper Prepared for African Development Report. 7. Aryeetey, E., et al. (1994). Supply and Demand for Finance of Small Scale Enterprises in Ghana, World Bank Discussion Paper No. 251 Banking Law 1989 PBDCL 225. As amended by banking Act of 2004, Financial Institutions (Non-Banking Law 1993, PNDCL 328). 8. Aryeetey, E., Hettige, H., Nissanke, M., and Steel, W. (1997). Financial Market Fragmentation and Reforms in Ghana, Malawi, Nigeria, and Tanzania, The World Bank Economic Review, 11(2), 195-218. 9. Bartels, K. (2003). Press Briefing, by private sector Development, conference room, ministry of information, 15th July. 10. Basil, A. N. O. (2005). Small and Medium Enterprises (SMES) in Nigeria: Problems and Prospects, Ph.D. Thesis, St. Clements University. 11. Basu , A., Blavy, R., and Yulek, M. (2004). Microfinance in Africa: Experience and Lessons from IMF - International Monetary Fund. 12. Daniels, L., and Ngwira, A. (1993). Results of a Nationwide Survey on Micro, Small and Medium Enterprises in Malawi, GEMINI Technical Report No 53 PACT Publications, New York. 13. Ekumah, E. K., and Essel, T. (2003). Information is Power: the Problem with Credit Accessibility in Rural Banks in Ghana. 14. Elaian, K. (1996), Employment implications of small scale industries in developing countries: Evidence from Jordan, Science, Technology and Development, 14(1). 15. Fissaeha, Y. (1991). Small Scale Enterprises in Lesotho: Summary of a Countrywide Survey, Gemini Technical Report, No 14 Washington D.C, Development Alternatives Inc. 16. Goski, A., Joshua, A., and Stephen, T. A. (2007). The Role of “Susu” A Traditional Informal Banking System in the Development of Micro and Small Scale Enterprises (MSEs) in Ghana. International Business and Economics Research Journal, 6(14). 17. Jone, H., et al. (2000). Linking Formal and Informal Financial Intermediaries In Ghana: Conditions For Success and Implications For Development, No.61, November. 18. Liedholm, C., and Mead, D. (1987). Small Scale Industries in Developing Countries: Empirical Evidence and Policy Implications, International Development, Paper No.9, Department of Agricultural Economics, Michigan State University, East Lansing, MI, USA. 19. Mbai, B., Akwasi-Kuma J. (1997). UNDP Microfinance Assessment Report Prepared as a component of the MicroStart Feasibility Mission – September. 20. Mead and Liedholm (1998). The Dynamics of Micro and Small Enterprises in Developing Countries. World Development, 26(1). 21. Miracle, P. M., Miracle, D. S., and Cohen (1980). Informal savings Mobilization in Africa. Economic development and Cultural Change, 28(4). 22. Nwikina, C. G. (2002). Fundamentals of money and banking in Nigeria, Analysis of issues and institutions. Owerri: Springfield Publishers.

23. Osei, B., Baah-Nuakoh, A., Tutu, K.A, and Sowa N.K (1993). Impact of Structural Adjustment on Small-Scale Enterprises in Ghana. In Helmsing A.H.J and Kolstee T. H(eds), Structural Adjustment, Financial Policy and Assistance Programmes in Africa. IT Publications. 24. Robson, G., and Gallagher C (1993). The Job Creation Effects of Small and Large Firm Interaction, International Small Business Journal, Vol. 12 PP 23-37. 25. Schmitz, H. (1995). Collective Efficiency: Growth Path for Small Scale Industry. The Journal of Development Studies, 31(4), 529- 566. 26. Steel and Webster (1990). Ghana?s Small Enterprise Sector: Survey of Adjustment Response and Constraints, Industry Series Paper 41. World Bank, Industry and Energy Deppartment Washington D.C. 27. Stephane, S. (2004). Informal Sector: The Credit Market Channel. Journal of Development Economics, 78(17), 299-321 28. UNIDO (1983). The Potential for Resourcebased Industrial Development in the Least Developed Countries, No.5 –Malawi. 29. World Bank (1992). Malawi: Financial Sector Study, Washington D.C