Islamic Banking Financing Growth of Small and Medium Enterprises (SMEs) In Zaria, Kaduna State Nigeria

Abdulraheem Nafisat and Abas Rutaro

Kampala International University Uganda

ABSTRACT

The study aimed to examine the relationship between Islamic banking and the growth of   Small and Medium Enterprises in Zaria, Kaduna State. Nigeria. Specific Objectives were to determine the relationship between Islamic banking and profitability; to examine the relationship between Islamic banking and market share; and to find out the relationship between Islamic banks and return on investment of Small and Medium Enterprises in Zaria, Kaduna State, Nigeria. The study adopted correlational and cross-sectional research designs. The study used primary data collection through the use of questionnaires. Questionnaires, both structured and unstructured were designed with snares to check validity and reliability, a sample size of 217 respondents given a study population of 500 respondents was selected using Krejcie and Morgan table. Findings reflected that there was a strong positive relationship between Islamic banking and profitability by a correlation coefficient(r) of 0.871 which is statistically significant since the p-value (0.000) < 0.01. Findings revealed that there is a moderate positive relationship between Islamic banking and profitability as this was evidenced by a correlation coefficient(r) of 0.525 which is statistically significant since the p-value (0.000) < 0.01. The study concluded that there is a significant positive relationship between, there is a significant positive relationship between Islamic banks and the return on investment of Small and Medium Enterprises in Zaria, Kaduna State, Nigeria, and there is a significant positive relationship between Islamic banks and the return on investment of Small and Medium Enterprises in Zaria, Kaduna State, Nigeria. The study recommended; that the relationship between Islamic banks and Small and Medium Enterprises growth should be studied in another important town in Nigeria. There should be aggressive marketing of Islamic bank products to reach out to the populace beyond the business owners. Islamic should organize regular meetings with business owners to educate them on risk-taking that can hinder their growth.

Keywords: Islamic Banking, Small and Medium Enterprises (SMEs), Profitability, Return on Investment (ROI), Zaria, Kaduna State

CITE AS: Abdulraheem Nafisat and Abas Rutaro (2025). Islamic Banking Financing Growth of Small and Medium Enterprises (SMEs) In Zaria, Kaduna State Nigeria NEWPORT INTERNATIONAL JOURNAL OF CURRENT RESEARCH IN HUMANITIES AND SOCIAL SCIENCES 5(1):51-62. https://doi.org/10.59298/NIJCRHSS/2025/5.1.516200