Effect Of Credit Access On Rural Household Welfare In Ogun State, Nigeria

The study examined the effect of access to credit on the welfare of households in Ogun State, Nigeria, using primary data obtained from 480households. The Mean Per Capita Household Expenditure (MPCHE) was used to categorize households into poor and non-poor. Descriptive statistics, binary probit regression, and logit regression models were used to analyze the data. Majority of the respondents were male (78.7%), married (68.1%) and not more than 60 years of age (76.3%). Many of the respondents had secondary education (46.3%). Only 12 (2.5%) of the respondents were able to obtain loan from the commercial bank, 93 (19.4%) from the microfinance bank, while more than half of the respondents (61.3%) got credit assistance from the cooperative societies they belonged to. Average household size was 7 and access to credit significantly affected household welfare in the study area. Based on these findings, it was recommended that a functional rural-based organization should be established by the government and other stakeholders in rural development that will see to coordinating, educating, training and capacity building of rural dwellers to be able to access credit facilities from financial institutions.