CHAPTER ONE

1.0 INTRODUCTION

Commercial banks credit polices provides a wide range of financial services to individual, small or medium sized firms and corporate clients through its Network of brancher. In all its branches bank offers a range of retail banking services, cheap exchange rate, they also offer trade financial services such as granting of loans facilities to small scale enterprises. The commercial banks credit polices also help in evaluating new business opportunities and help in effective and efficient running and management of their resources to ensures growth and development in their profit.

1.1 BACKGROUND OF THE STUDY In far back 1960 and prior to the role of small business over shadowed by corporation a phenomenon which reprimanded the close relationship between large sacle enterprises and the state in general. The commercial banks few years ago saw interest in small scale enterprise and guided to put in place some specialized financing facilities of scheme primarily to boost their ego (small enterprises). The focus on small scale enterprises is predicated on their impact and contribution to a diversified productive base as well as their effect in achieving macro objective such as employment generation and promoting of indigenous firms and the technology that will lead to good economic growth, development and stability.

1.2 STATEMENT OF PROBLEMS The fundamental problems which constraints small scale industries to credit, is the law level credit rating form formal sources such as bank and the credit schemes managed under the low credit rating of small scale industries. Other problem such as transportation inability to export their products, lack of funds to purchase plants and machinery for quick and standard production, expensive cost of raw materials and the issues of not keeping accurate records of their daily transactions. This are points that will be examined such condition necessary for credits are extremely stringent and as the most scale entrepreneur cannot meet such requirement for loans to be granted to them.

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