ACCESS TO LOAN AND REPAYMENT IN BANK OF AGRICULTURE (BOA) BY FARMER BENEFICIARIES IN ABUJA, NIGERIA (2011-2015)
AbstractLoan acquisition and repayment among bank of Agriculture Famers’ loan Beneficiaries in the Federal Capital Territory (FCT)Abuja, Nigeria (2011-2015). Farmers are financially handicapped as a result they are unable to obtain the resources required. The specific objectives of the study were to; examine the socioeconomic characteristics of the loan Beneficiaries, examine the acquisition and repayment trend over the period under study, determine the socioeconomic factors that influence loan acquisition and repayment, identify the benefits derivable from loan acquired by the famers, and isolate the constraints associated with obtaining loan from the Bank of Agriculture (BOA) and repayment. Purposive, proportionate and random sampling techniques were used to ensure a good spread of the study. Both primary and secondary sources of data were used for the study. Data were collect with structured questionnaire from 240 randomly selected Bank of Agriculture farmers’ loan beneficiaries. Results of data cleaning invalidated 18 questionnaires leaving 222 questionnaires for analyses. The data were analyzed using mean, percentage, simple regression and multiply regression techniques and descriptive statistics. Results shows that majority (64.9%) of the farmers were males, mean age was 43.4 years, most (72.9%) of the farmers were married, mean household size was 7 persons, mean level of education was 10.5 years, mean farm size was 2.03 Ha, mean farming experience was 12.7 years, and mean annual farm income was N 309,560.81. The mean amount of loan requested was N 339,315.32 while the mean amount of loan obtained was N 208,472.97 which is about 61% of the mean amount of loan requested. The mean amount of loan repaid was N163,675.68, which is about 79% of the mean amount of loan acquired. Results of trend analyses showed an increasing trend loan repayment and time. Loan request, loan acquisition and loan repayment had significant positive relationship with time. The socioeconomic factors that influence loan acquisition are age, level of education, farming experience, annual farm income, farm size, interest on loan, type of collateral, and distance to the bank. The result of the regression analysis revealed that the joint effect of the explanatory variables in the model account for 73% and 75% of the variations in the socioeconomic factors effecting the farmers; loan acquisition and repayment. The major constraints associated with BOA loan acquisition and repayment were lack of required collateral, late approval /disbursement, high interest rate, high loan transaction cost, bureaucratic bottlenecks, and difficulty in getting guarantor, long distance, insufficient loan amount. The study, therefore recommended that a sustainable lending policy framework be established by relevant agencies (Government and BOA) to enable farmers obtain adequate loan amount at reduced interest rate and also on time.
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