Factors Enhancing Innovation Performance of Microfinance Banks in Nigeria: A COVID-19 Period Study

Uzoma Heman ONONYE; David AKAUN; Shedrack MOLUNO

Uzoma Heman ONONYE Dennis Osadebay University, Delta State, Nigeria
David AKAUN Dennis Osadebay University, Delta State, Nigeria
Shedrack MOLUNO Delta State University of Science and Technology, Delta State, Nigeria

Keywords: COVID-19, Digital Transformation, Environmental Scanning, Strategic Alliance, Safety Culture, Innovation

Abstract

The COVID-19 crisis may have a far-reaching impact on the performance of microfinance banks [MFBs], given the opportunities and threats it presents. One of the ways organisations can improve and maintain performance is through innovation, but the factors promoting innovation during a period of crisis are yet to be fully explored and understood in a MFB setting. The study aimed to examine the antecedents of innovation performance at MFBs in Nigeria during the COVID-19 crisis. To carry out this examination, data were collected from 133 top managers of MFBs operating in southern Nigeria and subjected to the two-step procedure for structural equation modelling using the partial least squares [PLS] analytical technique. The PLS results revealed that digital transformation, environmental scanning, strategic alliances, and safety culture positively and significantly enhanced the innovation performance of MFBs. The study recommended that MFBs should deploy a mix of strategies, as there is no one-way, standalone, or best solution to enhance innovation performance in a crisis situation of this nature. However, managerial consideration should be given to the identified antecedents, given their significance for furthering innovation activities in MFBs.