CONTEXTUAL AND CONTEMPORARY EFFECT OF THE RECENT REMOVAL OF FUEL SUBSIDY ON SMALL BUSINESS

ACCOUNTING, BANK LOAN AND PERFORMANCE IN NIGERIA

Abstract

To build an economy of a Nation involved both the citizens and administrators that are saddled with the responsibility to manage Nation’s economy. The policies and decisions taken by the administrators and managers ought to be in line with the aspirations and expectations of the citizens of Nigeria, as to the citizens’ expected benefits. The recent removal of fuel subsidy by the current Nigeria government of President Ahmed Tinubu called for serious attention and concern. Small business: accounting system, bank loan and performance had been of concern. This study investigated the contextual and conceptual effect of this recent fuel subsidy removal on small business accounting system, approach for bank loan and how the performance of these small businesses had been so far. The study adopted the descriptive survey design with population of 980. However, 865 responses were collected from small business investors that had accounting system, enjoyed bank loan and had performed business for over three years. . The age bracket of the respondents ranged from thirty-five years and above. The source of data for this research was primary with a self-administered questionnaire as the instrument for the data collection. The questionnaire used for this study was in five-point Likert-scale, validated by four senior lecturers in a closely related field. Linear regression method was adopted for data analysis employed; test the hypotheses which investigated the contextual and conceptual effect of recent removal of fuel subsidy at it affected small business accounting system, approach to bank loan and small business performance. Finding revealed that the recent removal of fuel subsidy by the current government had greatly, negatively, and significantly affected small business ways of accounting system, discouraged them to approach banks for loan and their performance had dwindled to the negatives. The small business had been forced into backward adjustment of their accounting system, found it difficult to approach banks for loan, and their performances had dwindled with very low patronage by customers. The study concluded that the government had all the opportunities to in the short run take decisions and make policies not detrimental to the citizens of Nigeria but never took a second thought before implementation of the removal. Recommendation was the current government should reverse to fuel subsidy immediately for small business to improve its accounting system, access bank loan and improve performance.