Agricultural credit and farm productivity in Bichi local Government, Kano State, Nigeria

Thumbnail Image
Journal Title
Journal ISSN
Volume Title
Kampala International University, College of Economics & Management
This study set out to investigate the impact of agricultural credit on farm productivity for export in Bichi Local Government, Kano State, Nigeria. The study was guided by the following objectives: i) to determine the level of farm productivity in Bichi local government, Kano State, Nigeria, ii) to find out the common challenges faced by the local farmers in accessing agricultural credit from commercial banks in Bichi local government, and iii) to assess the effect of agricultural credit on the level of farm productivity in Bichi local government. The study used a sample size of 359 respondents. OLS regression was used to determine the effect of agricultural credit on farm productivity. The study revealed a high level of farm productivity with a yield as high as 60,000kg per 20 hectares of land. In addition to that, the study revealed a significant effect of agricultural credit on farm productivity (purpose of loan; r0.668**, p<O.O5; loan amount, r=0.648, p<O.OS). Furthermore, the most common challenges that affected loan access included among others, lack of collateral, high interest rate, complex bank systems and late approval. The study concluded that loan purpose and loan size contribute a significant effect on farm productivity. This is because using a right amount of loan for buying improved seeds, fertilizers, crop chemicals or irrigation contributed a great deal to the level of farm productivity. However, access to agricultural credit has often not been easy given the lack of collateral among farmers, high interest rate, complex bank system and late loan approval among others. This has often limited farmers to potentially be able to expand their production/productivity. The study recommended that in order to get maximum output, polices of commercial banks should be flexible and rate of interest should be less for small farmers than large farmers because small farmers hardly acknowledge their basic need. Similarly, efforts should be made to simplify the borrowing procedure in the terms of time-lag, acceptance of security, documentation and disbursement of loan
A thesis submitted to the college of Economics and Management in partial fulfillment of the requirements for the Award of the Degree of Masters of Arts in Economics of Kampala International University
Farm productivity, Credit, Agricultulture