Analysis of the Effect of Crowdfunding Platforms in Enhancing the Sources of Finance for Micro, Small and Medium Enterprises (MSMEs) in Nigeria.
Publication Date: 08/10/2025
Author(s): Bukar Ali Bularafa, Kachallah Umar Mustapha.
Volume/Issue: Volume 8, Issue 3 (2025)
Page No: 42-59
Journal: International Journal of Entrepreneurship and Business Innovation (IJEBI)
Abstract:
Micro, Small and Medium Enterprises (MSMEs) sub-sector plays a strategic role in the economic development of Nigeria, providing job opportunity, improving standard of living, regional development. However, MSMEs in Nigeria faced a financial exclusion which result in shortage of finances for their businesses. This prevents many from sustaining and growing their businesses. Crowd-funding is an innovative Fintech aimed at closing the financial gap faced by MSMEs through raising funds from crowd using the internet. This research examines the effect of crowd-funding platforms in enhancing the sources of finance for MSMEs in Nigeria. The idea behind this study is to examine the effect of crowd-funding platforms in enhancing source of financing for MSMEs, analyse the financial gap and challenges faced by MSMEs. Descriptive-survey research design was adopted using structured questionnaire as data collection instrument. The data collected was analysed using descriptive analysis, Pearson correlation and multiple regression. Findings revealed significant relationship exist between reward-based, debt-based fundings and MSMEs financing. But donation-based and equity-based no significance. Furthermore, the finding revealed that MSMEs in the study are faced with challenges in using crowdfunding platforms, also the study has realised that, there is a financial gap exist among MSMEs in the study area. Conclusively, findings also confirmed the validity of the crowdfunding model in the context of Nigeria. Policymakers should also ensure that the necessary infrastructure of the Fintech industry is publicly accessible in order to facilitate new crowdfunding platforms and other financing tools and for the purpose of raising awareness about the significance of crowdfunding for MSMEs. Future researchers should consider using different state, zone within the country.
Keywords:
Crowdfunding, Platforms, Finance, MSMEs, Nigeria.
