Agriculture Project Topics

Analysis of Credit Facilities to Small Scale Farmers. (a Study of Small-scale Farmers in Bende Local Government Area of Abia Sate)

Analysis of Credit Facilities to Small Scale Farmers. (a Study of Small-scale Farmers in Bende Local Government Area of Abia Sate)

Analysis of Credit Facilities to Small Scale Farmers. (a Study of Small-scale Farmers in Bende Local Government Area of Abia Sate)

 Chapter One


The specific objectives of the analysis of credit facilities to small scale farmers are:

  1. To analyze the impact of credit facilities to the operation of small scale farmers in
  2. To identify   and   analyze   the socio-economic  characteristics  that may influence farmer’s decision about whether or not to use
  3. To examine the probability that non-borrowers can borrow given that socio- economic characteristics are increased.




Agriculture is a major contributor to Nigeria’s GDP and small-scale farmers play a dominant role in this contribution (Rahji and Fakayode 2009), but their productivity and growth are hindered by limited access to credit facilities (Odoemenem and Obinne 2010). Credit institutions can be categorized into three groups:

  1. Formal, such as commercial banks, microfinance banks, the Nigeria Agricultural and co-operative Rural development Bank (NACRDB), and state government-owned credit
  2. Semi-formal, such as non-governmental organizations-micro-finance institutions (NGO-MFIs) and co-operative societies, and
  3. Informal, such as money lenders, and rotating savings and credit associations (ROSCA). Enhancing financial Innovation and Access (EFINA) (2008) notes that 23 percent of the adult population in Nigeria have access to formal financial institutions, 24 percent to informal financial services, while 53 percent are financially.

The role of credit facilities to small scale farmers has been identified as a major ingredient to agricultural development in the present economics. The small scale farmers are often considered as having greater opportunities of increasing production and farm income by adopting new technology, this potential can only be realised if farmers can gain access to funds to finance the additional inputs that are invariably required. All too frequently, small scale farmers have insufficient savings to finance the investment in additional inputs. Under the circumstance the obvious solution for farmers is to borrow, unfortunately, the desire is not available. This is largely because institution lenders are reluctant to advance credit to the agricultural sector. This can be attributed to the dependence of agricultural production on Nature and the high co-variance of risk from adverse weather and incidence of disease in any given location. The failure to realize the potential increase in agricultural production has forced the Nigerian Government to introduce programmes to address the problem of risk and accessibility of credit to small scale farmers.





Research methodology refers to the procedure and process of reaching sound, dependable and precise explanations to information acquired in the course of the study. It is achieved through a deliberate and organized collection, examination and interpretation of data. It forms the central part of the study because it concentrates on matter associated with sound and types of data, research population, sampling method of data analysis, data estimation techniques, model specification and significance of variable engaged in analysis.

This study is carried out mainly to analyse the impact of bank credit to small scale farmers in Nigeria.


The research design is the plan that outlines the procedure adopted and engaged in the research study. It discloses what tools the research will use in achieving stated objective, process of data collection, collection and presentation, operational implication and the analysis of data. It provides specifically the method to be used in gathering and analyzing data. The research design indicates how the research objective will be accomplished and how challenges encountered in the research will be tackled.

Small scale farmers most especially in the rural areas have limited education, as a result simple and precise questions which can easily be comprehended will be asked to determine the impact of credit facilities on their farming operation. The research design to be engaged in this study shall be descriptive survey design using structural interview.




In this chapter, the result of the investigation carried out in this study is presented. It consists of three sections, the first section deals with demographic data, the second section deals with the presentation of the selected variables based on descriptive statistics while the third section reveals the research hypothesis generated.

The results are presented in tables and discussion follows:


Table 4 – 1: Distribution of respondents by sex




This study analyzed the impact of credit facility to small scale farmers in Nigeria using Bende Local Government Area of Abia state as a major area of study. The study shows explicitly how credit facilities are crucial in the operation of small scale farmers.

In addition to financial operation incentive awarded to small scale farmers by commercial or agriculturally instituted financial institution acting within the confines of stipulated authority, the government in its own capacity too has succeeded in introducing agricultural schemes to boost agricultural productivity and assist farmers. Agricultural Programmes such as ACGSF, RUFIN, NIRSAL, GESS etc. have been introduced.

Also, this study revealed the credence of credit facilities as essential in the operation of small scale farmers in conformity with well researched journals, articles and texts. Study has shown that most of these agricultural schemes have been poorly articulated and managed, leading to further decline in farming operation of farmers.


Credit facilities play a crucial role in the operation of small scale farmers, this ensures that the derived output will be that which sustains the growth and development of the economy. The agricultural development policies will therefore be more ensured, if the investment on research and human development are given a proper attention in form of improved educational standard of the people to be able to design an appropriate research and in return formulate a sustainable policy programme.


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