Credit Utilization and Value Chain Development among Rice Farmer Beneficiaries of Bank of Agriculture Loan in Niger-Delta Area, Nigeria

 

 

 

Abstract

This study analyzed credit utilization and value chain development among rice farmer beneficiaries of Bank of Agriculture loan in the Niger-Delta Area, Nigeria. Data were collected from loan beneficiaries whose loans were due. Purposive and multi-stage random sampling techniques were used for sample selection and a total of one thousand and thirty-six (1,036) respondents were used for the study. Data were collected with the use of well-structured questionnaires and analyzed using simple frequencies, percentages, mean, t-test, double difference estimation technique, Pearson product moment bivariate correlation matrix, and factor analysis (principal component analysis). The socio-economic characteristics of the respondents showed that 86% were males and 16% were females. The mean age of the respondents was 39 years. All the rice value chain actors had formal education and had an average household size of 8 persons. The mean experience was 15 years. The Pearson bivariate correlation matrix analysis posits a significant, positive linear relationship (P≤0.05) between loans accessed and the rice value chain development parameters (number of employment created, scale of operation, and capital investment). The Pearson product moment correlation coefficient of 0.818, 0.735 and 0.499 indicates a positively strong and moderate relation between the parameters of development buttressing the descriptive statistics which suggested an increase in values of the developmental parameters of rice value chains after the actor’s access to BOA financial services and intervention. The result of factor analysis of constraints faced by rice value chain actors indicates that competition from foreign brands, inadequate storage facilities and inadequate land for farming were the major constraints faced by marketers, processors and producers respectively in the study area. The study therefore recommended that any agricultural financial intervention programme introduced either by government or private entrepreneurs, there is the need for adequate loan administration, monitoring and evaluation and that saving mobilization procedures should be inculcated in the policies and programs to stimulate optimum performance.

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