Farmers Perception of Repayment of Loans

In: Other Topics

Submitted By teenumathew20
Words 2618
Pages 11
© Kamla-Raj 2012

J Agri Sci, 3(1): 21-27 (2012)

Farmers’ Perception of Repayment of Loans Obtained from
Bank of Agriculture, Ogun State, Nigeria
I.F. Ayanda* and O. Ogunsekan**

Department of Agricultural Economics and Extension, Kwara State University, Malete, PMB
1530, Ilorin, Kwara State, Nigeria
Department of Agricultural Extension and Rural Development, University of Agriculture,
Abeokuta, Ogun State, Nigeria
Telephone: 08033737391; E-mail:

KEYWORDS High Interest Rate. Short Payback Period. Low Farm Productivity. Employment Generation. Loan Recovery
ABSTRACT This study examined farmers’ perception of repayment of loans in Ogun State, Nigeria. A multi-staged sampling technique was used to select 120 respondents for the study. Descriptive and Pearson Moment Correlation Statistics were used to analyze the data. Results showed that loan beneficiaries were mostly youth. Majority (74.8%) disagreed with the loan payback period of 7-12 months while 74.2% of the farmers perceived loans as grant (not payable). A significant and inverse relationship exist between interest rate (r = -.151; p ≤ 0.05), low farm output (r = -.113; p ≤ 0.05) and loan repayment; a linear relationship exists between age of farmers (r = .715; p ≤ 0.05) and loan repayment. The loans have the potential to create employment in the rural areas. Youth with repayment capability should be given priority in the issuance of loans to farmers.
Officials of Bank of Agriculture should strengthen loan recovery strategies.

Background to the Study
Nigeria is faced with the challenge of providing adequate food supply for its teeming population of 150 million. Food and Agricultural Organization (FAO) has consistently listed
Nigeria among countries that are technically unable to meet their food needs. This is because in most…...

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