Effect of Microfinance Banks' Performance on Agricultural Growth in Nigeria

Authors

  • DR. Matthew Akemieyefa Federal University Wukari

Keywords:

Microfinance credit, crop output, livestock output, agricultural productivity, Nigeria

Abstract

This study investigates the effect of microfinance bank performance on agricultural
productivity in Nigeria. Empirical results on the impact of bank credit on agricultural
productivity are inconclusive. These studies demonstrate diverse results which are debatable
and conflicting. Agricultural productivity is proxy by Crop output and Livestock output. The
datasets for the study are collocated from the Central Bank of Nigeria (CBN) from 2005-2020.
The formulated hypotheses are tested using the granger causality test. The result revealed that
microfinance credit has a non-significant effect on both crop output and livestock output. The
non-significant effect theoretically can be accredited to information asymmetry, bank capital
channel, moral hazard and adverse selection. The results indicate that farmers lack access to
microfinance credit facilities. The results revealed that to a large extent, farmers are selfsponsored and for economic diversification, governments must encourage effective ways to
increase bank credit flow to the agricultural sector through efficient bank intermediation. More
agricultural banks and improvement on the operational activities of the existing ones to ensure
direct credit to agricultural activities. Policies creating bottlenecks and undermining credit flow
to agricultural productivity should eliminate.

Author Biography

DR. Matthew Akemieyefa, Federal University Wukari

Department of Banking and Finance

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Published

2024-06-06

How to Cite

Akemieyefa, M. (2024). Effect of Microfinance Banks’ Performance on Agricultural Growth in Nigeria. FUW-International Journal of Management and Social Sciences, 9(2). Retrieved from https://fuw-ijmss.com.ng/index.php/fijmss/article/view/107