EFFECTS OF MICROFINANCE BANK CREDIT ON OUTPUT OF ARABLE CROP FARMERSS IN MINNA METROPOLIS, NIGER STATE, NIGERIA

Abstract

This study was carried out to examine the effects of microfinance banks ‘credit on output of arable crop farmers in Minna Metropolis, Niger State Nigeria. Specifically, the study described the socio-economic characteristics of arable crop farmers (users and non-users of Microfinance Bank Credit), examined the effects characteristics of arable crop production, identify the major constraints associated with micro finance bank credit. 60 users and 60 non-users of micro finance bank credit were selected for the survey through a multi-stage sampling procedure making a total of 120 respondents. The sample was drawn from two micro finance banks namely: Endwell microfinance bank and LAPO microfinance bank. Primary data were obtained using questionnaires administered to the respondents. Data were analyzed using descriptive statistics and multiple regression analysis. The result showed that 38% of the respondents were between the ages of 31 – 40 years, 75% were male, 53% had farming experience of between 11 and 20 years,58% had family size of 1 – 5 persons and 88% had formal education at various levels. The result of the regression analysis showed that farm size (P<0.01), amount of credit received (P<0.01), seeds (P<0.01) and farming experience (P<0.10) were the factors that influenced output positively while education influenced output negatively. Also, the study identified bureaucratic procedure in accessing the loan, high interest rate and distance to microfinance among others as the most pressing constraints encountered by respondents in accessing loan. Thus, the study recommended that farmers should apply for microfinance credit through cooperative societies to enhance easy access.