This project work is a study of the problem militating against small scale business financing. The shop studied is responsible for providing cooked food, cakes, sachet water, soft drinks and stationery; using Medan Business Centre, Auchi as a Case Study. The researcher examined the negative influence of finance on small scale business and the possible way(s) to address the problem if to continue with the viable existence of the business. In order to have a scope for the study, three hypotheses were raised. At the end of the research, it was discovered that every small scale business solve the problem of finance so as to ensure total viability and profitability of the business. It was discovered that (i) finance is a major problem of small scale business (ii) improper supervision is a problem in small scale business (iii) good patronage can increase the effectiveness and efficiency in small scale business.  








Title Page





Table of Contents 

Chapter One: Introduction

1.1   Background to the Study

1.2   Statement of Problem

1.3   Objective of the Study

1.4   Hypothesis of the Study

1.5   Significance of the Study

1.6   Scope of the Study

1.7   Definition of terms

Chapter Two: Literature Review

2.1   Introduction of the Review 

2.2   Review of Recent Literature

2.3   Formation of Small Scale Business

2.4   Characteristic of Small Scale Business

2.5   Sources Small Scale Business Finance

2.6   Problem of Small Scale Business

2.7   Solution to the Problem of Small Scale Business Of Financing

2.8   Importance of Small Scale Business

2.9   Problems of Small Scale Business in the Economy

2.10 Solution to the Problems of Small Scale Business in Nigeria 

Chapter Three: Research Methodology

3.1   Research Design

3.3   The Population of Study

3.3   The Sample and Sampling Techniques

3.4   Method of Data Collection

3.5   Method of Data Analysis

Chapter Four: Data Presentation and Analysis

4.1   Data Presentation

4.2   Analysis of Result

4.3   Discussion of Result


Chapter Five: Summary, Conclusion and Recommendations 

5.1   Summary

5.2   Conclusions

5.3   Recommendations









The future most small scale business as never been encouraging. However, the growing recognition of the importance of small scale business to our economy has been accompanied by the growing effort to secure more facts about independent enterprises and their problems and needs.

But most business organizations have failed to accomplish the various objectives for which they were set up. One of the masons that is responsible forth is not only the failure of performing adequate management functions, but also as a result of the problem of financing such businesses. Small scale business that have been most, successful in the achievement of their objectives have learnt the various ways of adequate finance without any set back.

Small enterprises have an important role in the economic development of development countries like Nigeria. They play an important role by making significant contribution to the economic development by creating employment opportunities for the unemployed providing capital resources for industries. All these roles help in raising the standard of living of a country economic development.

A large number of small scale business are set up
daily, out of these, half of that number goes down the
drains or failed at a point, due to financial problems.
Essentially, the small-scale business faces similar
problems and finds among competitive uses. Some of the problems small scale business encounter are,

i.      Poor access to sources of financing

ii.     Limited range of opportunities for employment funds profitability.

iii.    Obtaining loans of funds from financial institution is sometimes difficult,

iv.    They rely on funds from personal saving relatives money, lender on profit and from the operation of the enterprises.

v.     The rate of failure is high because these enterprises are mostly dominated by sole proprietors They reluctantly venture into partnership or limited liabilities companies due to back of confidence most business standard by technicians and traders. The researcher is of the opinion that in such a situation managerial vacuum is far less development an their technical till variable like financing human relation anti motivate member of staff who are indispensable in the effective management of a business.

These are the areas of focus on this research work. The researcher endavours to enlighten the prospects of a small scale business owners and current ones on how to effectively finance their business in order to achieve their desired goals and objectives.

Against the identified problem associated with
business financing, the researcher has designed this
study so that their problems can be overcome.

In recent times, the issue of mass unemployment, the rural urban migration and social problem have
attracted the attention of both state and federal governments. The role of small scale in achieving
economic growth and political stability cannot be

A cursory look at the rate of establishment and
failure of small scale business plague the establishment and failure of small scale business in the country precisely, the aims of it is study is to highlight the problems and prospects of financing small scale business with a view to suggesting some possible ways of soluting these problem identifies.


The main aim of this research is to identify the
problem of small scale financing and the various solution to them.

For this to be carried out efficiently the researcher should be able to know some of the limitations which may prevent the by mess from achieving its goals and its ability to raise finance. Some of the problems are

The entrepreneur is often not educated, lack of knowledge of potential sources finance. The study will
thus assist them know to present sources of financial assistance.

i.      Most small scale business is unquoted in the stock exchange market. This makes it difficult for them to et loans from banks, and other financial institutions because they are not recognized.

ii.     Lack of financial records.

iii.    Lack of financial advice.

iv.    Poor management which leads to small profit margin.

v.     Lack of limitation in capital formation


The primary aim and objective of any organization
or business is to row, survive and maximize profit
profit can not be maximized without adequate financing.

In realization of these facts the main aim and
objective of this research work is to fund out the

·                    The problems associated with small scale

·                    Other problem is associated with small scale enterprises.

·                    The importance of small scale in the economy.

·                    Finally the solutions to the problems of financing small scale business in the economy.


HO:   Finance is not a major problem of small scale business in financing Eborieme market.

HI:    Finance is a major problem of small scale business in financing Eborieme market.


The research work is important to many sectors of this economy some of its importance are

1.     It focused attention on the small scale business and therefore significant to prospective small scale business owners, it will help them, not only on the stop to take in the management and control of their business, but also on the various option opened to them for financing their business.

2.     It is also important in that at the end of the
research, government small scale business in
providing employment for the unemployment. The research will make government known the
specific roles to perform, in order to assist the individual proprietors in financing their business. Significantly too, this research will contributed to the
existing literature in the area of study it will therefore
serve as reference tool for information.

3.     This research work is also designed to sever the benefit of the students of business administration who want to know more about small scale enterprise financing. It will also be called as secondary sources for data
collection for the researcher.

4.     Lastly, this research work is also n partial fulfillment for the award of National Diploma certificate ND in Business Administration and management.


This study is limited to the problems associated with the small scale business sole proprietorship and partnerships are example of such industries precisely these include;

1.     Ndotewa shopping center

2.     Abundance venture

3.     Mana’s Shopping center

4.     Praise ventures

5.     Victories enterprises


1.     Small Business: Usually we hear much about the activities of large companies such as Delta steel, Nigerian National Petroleum Company and Nigerian Electric power authority, but little about the small firms that are an important part of the Nigerian business system yet small businesses generate more than half of all business receipts. In addition, they employed over half of the private workforce.

2.     Eborieme Market: Eborieme market was built in the year 2002 under the administration of Sir, Dr. Eborieme. It is situated inventory strategic position and direct opposite the school read. It is a market where exchange takes place.  

3.     Finance: someone has said, it takes money to make money. Though not always true, this statement does contain a large element of truth when applied to business or industrial establishment.

4.     Turnover: The term turnover describes the number of times inventory is bought and sold in a given period. To find the business turnover, total sales is divided by the average rattail value of inventory, at any given time or moment.

5.     Planning: Planning is futuristic; it is deciding in the present what to do in the future.  

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