ANALYSIS OF THE EFFECT OF FINANCIAL INCLUSION ON LIVELIHOOD DIVERSIFICATION AMONG CROP FARMING HOUSEHOLDS IN BORNO STATE, NIGERIA

The study analyzed financial inclusion and livelihood diversification among crop farming households in Borno State, Nigeria. Multi-stage sampling technique was used to select 490 respondents for the study. Data were collected through the use of a structured questionnaire, and were analyzed using both descriptive statistical tools (frequency, percentages, mean, minimum and maximum values) and inferential statistics (ordered logit regression model). The result revealed that 75.3% of the respondents are male with 52% aged between 31-40 years and the average age was 41 years. Majority of the respondents (63.7%) are married with average household size of 8 persons. Also, about 69% of the respondents had attended one form of education or another ranging from primary to tertiary education. Similarly, majority of the respondents (63.3%) had between 11-20 years farming experience with an average farm size of 1.6ha. Also, the respondents have an average annual household income of ₦453,000. The ordered logit regression revealed that financial inclusion variables such as using bank account (p<0.01), employment status (p<0.05), financial literacy (p<0.05), possession of skill (p<0.01), cooperative membership (p<0.05), distance to financial institution (p<0.01) and remittance (p<0.001) positively influenced livelihood diversification in the study. The study concluded that, there is a strong link between financial inclusion and livelihood diversification among crop farming households to earn income for a better wellbeing and economic sustainability. The study recommended among others, the need for both private and state stakeholders to establish policies that will support and enhance rural households financial inclusion status.