Contribution of microfinance banks to agricultural development in Chanchaga Local government Area, Niger State, Nigeria.

Abstract

The purpose of the study was to determine the contribution of microfinance bank to agricultural development in Chanchanga Local Government Areas of Niger State, Nigeria. Random sampling techniques were used to select 80 agricultural micro credit beneficiaries from the list of beneficiaries obtained from Nexus Microfinance Bank, Minna. Structured questionnaires were used to collect the primary data which were analysed using descriptive statistics and ordinary least square multiple regression analysis. Results showed that mode of disbursement were basically through cooperative societies (56%) and individuals (40%). Loan taken were paid back installmentally while the loans were in favour of small and medium scale entrepreneurs (41%). Agriculture accounted for 27% of total beneficiaries. Multiple regression analysis indicated that the linear function was the lead equation with the amount of loan received and labour being statistically significant at 1% and farm size 10%. It was concluded that Nexus Microfinance Bank had contributed positively to agricultural development in the study area. It was therefore recommended that farmers need to be organized into cooperatives and credits should not only be disbursed in cash but also in kind.