An Investigation into Credit Receipt and Enterprise

The study was designed to analyze credit receipt andenterprise performance by small scale agro based enterprisesin the niger delta region of nigeria. a multistage samplingtechnique was adopted in selecting 264 agro based enterprisesand 96 agro based enterprises that accessed informal andformal credit respectively. the heckman model was used toexamine the factors affecting amount of informal and formalcredit received by the enterprises. financial ratios such as thecurrent ratio and return on capital employed ratio were used inaddition to the t-test to examine the performance of enterprisesthat borrowed from informal and formal credit markets in thearea. analyses of informal credit amount received reveal thatgender, age and social capital are significant for the firsthurdle, whereas gender, size, income, guarantor and socialcapital are significant for the second hurdle. similarly, gender,education, age, size, and collateral are significant for the firsthurdle for formal credit, while the second hurdle reported significantresults with age, size, income, collateral and socialcapital. formal credit was less accessible than informal creditbut enhanced greater performance. formal credit should bemade to be easily accessible and efficiently utilized. this willgo a long way in complementing the amnesty programme ofthe federal government of nigeria in the region.