Financial inclusion and performance of Small and Medium Enterprises (SMES) In Osun State, Nigeria

This research investigates the impact of financial inclusion on small and medium-sized enterprises (SMEs) in Osun State, Nigeria, with a focus on financial access, usage, and quality. A self-administered questionnaire was used to collect primary data from a sample of 150 SMEs that were either owned or managed. This study used a descriptive approach. Using both descriptive and inferential statistics was part of the data analysis. Regression analysis reveals that SMEs' performance is significantly predicted by their financial availability, with a standardised beta coefficient (β = 0.694, p = 0.05) accounting for more than 69.4% of the variance in performance. Analogous to this, financial usage shows a substantial positive correlation with performance since a 1% increase in usage leads to a 63% gain in performance (β = 0.626, p = 0.05). Moreover, financial quality turns out to be the most important determinant; a 1% increase in quality results in a similar performance increase and a standardised beta coefficient (β = 0.700, p = 0.05) explains 70% of performance variance. The study comes to the quite clear conclusion that financial inclusion greatly improves the performance of SMEs in Osun State. The results imply that by bettering financial infrastructure, providing tailored financial products, and implementing more inclusive lending policies to raise SMEs' access to financial resources, financial institutions and legislators can help SMEs.