Effect of Business Environment on Performance of Micro, Small, and Medium Enterprises (MSMEs) in Federal Capital Territory (FCT), Nigeria.

This study explores the impact of business environment on the performance of Micro, Small and Medium enterprise (MSME) in 6 local governments areas (LGAs) of Federal Capital Territory (FCT), Nigeria which include; Abuja Municipal Area Council (AMAC), Bwari, Gwagwalada. Kuje, Abaji and Kwali LGAs. The study employed a mixed-method approach combining surveys of 400 MSMEs and interviews with 20 stakeholders using purposive sampling techniques with a specific emphasis on identifying regulatory inefficiencies, infrastructure deficits, financial exclusion, and market competition as critical constraints. The research reveals that financial access has the strongest positive effect on performance (β=0.513, p<0.001), while infrastructure gaps (mean=2.3/5) and regulatory bottlenecks (mean=2.8/5) significantly hinder growth. Qualitative findings highlight adaptive strategies such as niche specialization and informal financing, though these often impose hidden costs. Despite policy interventions, implementation gaps limit their effectiveness. Recommendations include infrastructure investment, regulatory digitization, and enhanced financial inclusion to foster a more enabling ecosystem. The study underscores the need for coordinated action between policymakers, financial institutions, and MSMEs to unlock the sector’s potential.