STRATEGIC ALLIANCE AND MARKET SHARE OF SELECTED MICROFINANCE BANKS IN LAGOS NIGERIA

Abstract

Strategic alliance has been associated with competitive advantage, yet not all alliances yield expected results. The microfinance sub-sector in Nigeria have been linked with poor performance like poor market share, low returns on asset, lack of innovative products. There seems to be some level of pessimism that the sub-sector cannot serve as a catalyst to economic growth. This has been attributed to a lack of cohesion among microfinance banks which has created a huge gap among practitioners. The study investigated the effect of strategic alliance dimensions on market share by administering 220 questionnaires to selected microfinance banks in Lagos Nigeria. Using multiple regression analysis, the results show that strategic alliance dimensions have a significant and positive effect on market share. The findings revealed adjusted R 2 = 0.107, F(4, 155) = 5.757, p=0.000 (p <0.05). The paper recommended that microfinance banks focus on alliance as a way to increase competitive advantage.