The paper analyzes the determinants of new products innovation in the SMEs sector.\nThe study focused on types of innovation funding and sources of innovation funding.\nFive-hundred and fifty (550) SME owners were randomly selected for the study.\nInformation was sourced through the use of questionnaires. Tobit model was\nused for the analysis. Sales value of new products was used a proxy for new\nproducts innovation. The determinants were grouped into two types thus innovation\nexpenditure and sources of innovation expenditure. Sources of innovation\nexpenditure have significant influence on new products innovation. From the\nfinding foreign capital, government tax credit, and subsidies had significantly\ninfluence on new products innovation. SMEs specific attributes such as patent\nand having overseas partners influence new product innovation.\nPolicies and programs geared towards government tax credit, subsidies, patent\nrights and inflow of foreign capital into SME sector should be encouraged\nsince they have the potential of promoting product innovation in the sector.
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