URBAN INFORIVIAL SECTOR AND CREDIT ACCESSlBiLITY IN THE NIGERIAN ECONOMY: A CASE STUDY OF JOS METROPOLIS

The objective of this study is to develop a framework that would facilitate
adequate and sustainable delivery of credit to the urban informal sector
operators. Inadequacy of savings and access to capital constitute a major
obstacle to the activities of the self-employed of the urban infonnal sector in
the Nigerian economy. Unfortunately, because of lack physical collateral,
high transaction cost, among others, the operators of the informal sector
have no access to institutional credit. Thus, informal lenders have become
the basic source of credit. Consequently, the informal sector's productive
base and contributions remain small, the production process is rudimentary
and inefficient, growth is stifled and opportunities for links with the formal
sector, paiiicularly the forward linkages do not see1n to exist. The study
made use of primary data generated through the use of questionnaire. It
established that the informal financial sources on which the urban informal
sector operators rely for credit In. order to facilitate access to credit by the
urban informal sector operators, and hence promote their activities, the study
recommends the following measures: formulation and implementation of
microfinance policy, linking formal with informal finahcial institutions,
adoption of flexible credit procurement procedures by the formal financial
institutions, establishment of credit guarantee scheme· by the Federal