Effect of financial literacy and regulatory constraints on leasing financing of small and medium-sized enterprises (SMEs) in Jigawa State, Nigeria
DOI:
https://doi.org/10.33003/fujafr-2026.v4i4.437.16-28Keywords:
Leasing Financing, Financial Literacy, Regulatory Constraints, SMEsAbstract
Purpose: This study investigates how financial literacy and regulatory constraints influence the leasing financing of small and medium-sized enterprises (SMEs) in Jigawa State, Nigeria.
Methodology: The study adopted a cross-sectional survey research design. The study population consisted of 13,912 SMEs registered with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) in Jigawa State, from which a sample of 389 SMEs was obtained using the Taro Yamane (1967) formula and chosen by means of random sampling. A structured questionnaire was given to owner-managers, and the data were analysed using partial least squares structural equation modelling (PLS-SEM).
Results and conclusion: The findings of the study revealed that financial literacy has a significant and positive relationship with leasing financing, while regulatory constraints displayed a positive but statistically insignificant relationship.
Implication of findings: Accordingly, this study recommends that SMEDAN, development finance institutions, and leasing companies should create leasing-specific financial literacy programmes for SME owner-managers, and that lessors should provide plain-language contracts and advisory support. Moreover, regulators should keep simplifying the licensing, registration, taxation, and documentation requirements associated with leasing transactions.
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