ANALYSIS OF FARM CREDIT ACCESS AMONG CASSAVA-BASED FARMERS IN SOUTH-SOUTH NIGERIA

The study examined the factors that determine rural credit access among farmers who are engaged in cassava-based farming in South-South Nigeria. It identified the reasons for farmer’s inability to access farm credit, and analyzed the factors that influences the decision to access farm credit and the amount of farm credit accessed. Data was collected from 284 farmers across three States, and analyzed by descriptive statistics and Heckman selection model. The Heckman first hurdle regression model had a significant Lambda value of -0.102, and positively significant coefficients of age, education, farming experience, land area, and awareness of lending institutions at p < 0.01, while household size and incidence of oil spillage were significant at p < 0.10 respectively; similarly, the second hurdle model recorded significant values on: education at p < 0.01, years of experience at p < 0.05, whereas household size, extension visit, land area, and incidence of violence were found to be significant at p < 0.10. The factors identified as key constraints to farm credit access are: lack of collateral, exorbitant interest rates, bureaucracies, constrained mobile networks, delayed loan approval, sentiments and tribalism, absence of guarantors, and dearth of banks in rural areas. Also, majority of the farmers perceived that reduction in interest rates and the removal of collateral security as requirement for accessing farm finance will help to improve access to farm credit. To address important demand-side obstacles impeding smallholders' access to farm finance, we recommend that policy must focus on enhancing the availability of information, extension services, and banking services to rural farming families. This will expand smallholders' access to credit, boost agricultural output, and enhance rural livelihoods.