EFFECT OF SUBSIDY REMOVAL ON ORGANIZATIONAL PERFORMANCE, A STUDY OF SMALL AND MEDIUM-SIZED ENTERPRISES (SMES) IN FUNTUA METROPOLIS KASTINA STATE
Abstract
This study investigates the effect of fuel subsidy removal on organizational performance of MSMEs in Funtua Metropolis using a survey design method. the population of the study consist of 1500 registered SMEs in Funtua as at 2024. The study adopts a sample of 316 SMEs firms was selected from the total population using a purposive sampling technique. Primary data is collected through structured questionnaires and semi-structured interviews. The data were analyzed using descriptive and inferential statistics. The findings revealed a statistically significant relationship between government support programs and the performance of SMEs in Funtua. Also, technological adoption also demonstrated a strong positive effect on SME performance. The findings also confirmed that the economic environment, particularly inflation, exchange rate volatility, and interest rate increases, significantly affects SME performance. The direct effect of fuel subsidy removal on MSME performance was found to be significant. The study recommended that policymakers should expand access to funding, grants, and tax incentives for SMEs, particularly in regions with weak financial infrastructure. Public-private partnerships should be encouraged to increase outreach and efficiency of government interventions. Also, the study recommended that government and development agencies should subsidize digital infrastructure and offer capacity-building programs to help SMEs adopt e-commerce, mobile payments, and digital recordkeeping tools
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