Impact of Government Ease of Doing Business Policies on SME Performance in Oyo State, Nigeria

Abstract

This study examines the impact of government Ease of Doing Business (EoDB) policies on the 
performance of SMEs in Oyo State, Nigeria, focusing on business registration reforms, 
financial accessibility, and taxation. This study addresses a critical gap in research on localised 
policy implementation by employing institutional theory and the resource-based view to 
analyse the regulatory effects on SMEs. A mixed-methods approach was employed, combining 
surveys from 450 stratified-randomly selected SMEs with qualitative interviews, evaluated 
through hierarchical regression and thematic analysis. Key findings reveal that while 
registration reforms reduced processing times (68% completed within 14 days compared to 
42% before the reforms), operational efficiency remained static. Only 18% of respondents 
secured loans, with rural SMEs disproportionately disadvantaged (7% approved versus 32% 
for urban SMEs). Tax compliance costs constituted 14.2% of income, whereas 87% of 
respondents faced unauthorised fees, leading to an 18% decline in productivity. The analysis 
indicates that current policies inadequately address structural imbalances, disproportionately 
affecting micro and rural enterprises. Recommendations include structured formalisation 
initiatives, enhanced financial inclusion, and rigorous actions against exorbitant fees to foster 
equitable growth of SMEs.