Socio-Economic Determinants of Small and Medium Enterprises’ (Smes) Access to Credit from the Barclays Bank in Tamale-Ghana
Authors: Fatawu Alhassan & Ahmed Sakara
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A review of the literature dealing with financing small and medium-scale enterprises (SMEs) indicates there is a significant gap in knowledge of the determinants of access to finance by the SMEs in Ghana. Therefore, this study examined the socio-economic factors that determine access to bank finance by SMEs in Tamale, Ghana. The population for the study was members of the Association of Small Scale Industries (ASSI), the branch Manager and credit officer of the Barclays bank Tamale, the Regional Manager and Accountant of National Board for Small Scale Industries and a Project Officer of macrofinance and small loan centre (MASLOC) .The results indicated that, the number of employees, experience in credit use, number of fixed assets possessed, attitude towards risk, business size, form of business and sector of business in the economy are the critical success factors in accessing bank finance. The study also identified Management expertise, high default rate and monitoring as the challenges banks faced in giving credit to SMEs. In terms of policy, the findings of this study will provide banks, training institutions and policy makers with new insights on investigation of loan evaluation process, tailoring new training programmes for entrepreneurs and developing relationships with business associations.
Key words: Enterprises, Small-scale, Medium-scale, Tamale, Barclays Bank and Entrepreneurs