ABSTRACT
This research study explores the impact of Microfinance Banks (MFBs) on the growth of Small and Medium-sized Enterprises (SMEs) in Edo State, Nigeria. The objective is to assess the contribution of microfinance services in fostering the growth and development of SMEs, which are considered vital for economic progress and poverty reduction in the region. The study investigates various factors related to MFB services and their influence on SMEs' growth, including access to finance, business development support, and financial literacy programs. Primary data was collected through structured questionnaires administered to SME owners and managers. The findings reveal that MFBs play a significant role in facilitating the growth of SMEs in Edo State. The accessibility of microfinance services, including microloans, savings accounts, and business advisory services, has positively influenced the financial and operational performance of SMEs. Access to finance emerged as a critical factor, enabling SMEs to expand their operations, invest in productive assets, and seize market opportunities. However, challenges such as high interest rates, limited loan sizes, inadequate collateral requirements, and the lack of specialized financial products tailored to SMEs' needs were identified as barriers to optimal utilization of microfinance services. The study concludes that Microfinance Banks have a positive impact on the growth of SMEs in Edo State. The findings highlight the importance of strengthening the microfinance sector through policy measures, including regulatory reforms to address interest rates and collateral requirements, as well as capacity building initiatives for MFBs to enhance their service delivery. Moreover, collaboration between MFBs, government agencies, and non-governmental organizations is crucial to improving SMEs' access to finance, business support, and financial literacy programme
