CURRENCY RESTRUCTURING AND SMALL AND MEDIUM SCALE ENTERPRISE

ABSTRACT

This study examined how currency restructuring affect the performance of SMEs in Nigeria, investigated the impact of currency restructuring-induced exchange rate fluctuations on SMEs in Nigeria, examined how the atmosphere of financial uncertainty created by currency restructuring affect SMEs' growth in Nigeria and how security/kidnapping has been aided or reduced by the restrictions on volume of Cash accessible to account holders. Descriptive and regression analysis was utilised for the analysis. It was revealed that: currency restructuring has a negative and significant on the performance of SMEs in Nigeria; currency restructuring-induced exchange rate fluctuations negatively and significantly impact the performance of SMEs in Nigeria; financial uncertainty engendered by currency restructuring does not significantly affect SMEs' growth in Nigeria; and there is a negative but not statistically significant effect of security/kidnapping situations in Nigeria on the performance of SMEs. Based on these findings, it was recommended that: governments and the Central Bank should work together to achieve exchange rate stability; financial knowledge and education should be vigorously promoted among small business owners and management; SME risk management processes, particularly currency risk management, should be rigorous; and supportive programmes should be created for SMEs that are adversely affected by currency restructuring.