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1.0     Introduction

1.0.1  Agricultural Development in Nigeria

Agriculture has been the most important sector of the Nigerian Economy. It employs about 80% of the Ad. Ult working population and earns about 60% of the gross domestic product (gop) of the economy. This is largely one reason why the country's economic development has been based primarily on the expansion of peasant agriculture production (Olayide, 1981). Manfred Et Al (1997), Observed that for decades, the task of rural finance was primarily seen to be promoting agriculture production by providing credit to farmer. When problems began to accumulate in the 1970's and 1980's as a result of oil boom, leading to outright failure of some state or donor sponsored banks and credit was frequently abandoned, structural adjustment and financial sector reform moved to the centre of attention. The position of agriculture as the dominant sector was then eliminated at the onset of the oil boom in the 1970's. This situation remained until the exploitation of crude petroleum in the commercial quantities began in the country. Manfred et al (1997), reported that the most significant constraints is that of restricted to credit facilities to enable farmers to improve upon their farming operation. More than 70% of nigeria populace are engaged directly in agriculture. this implies that food consumption and export would be sufficient, but majority of the farmers produce on a very small-scale. This is evidenced by the fact that small scale farmers account for about 900/0 of the output of crops grown in nigeria, while about 600 /0 of the country's population earn their living on small-scale farming (Olayemi, 1980). Small-Scale Farmers are faced with numerous problems which include: inadequate power supply and portable water, problem of pest and diseases! Infestation and inadequate preservation and storage facilities e.g transport routes to farm land resulting to ineffective marketing and distribution of produce.

1.0.2  Agricultural Credit Facilities in Nigeria

Agricultural credit plays an important role in agriculture development of Nigeria. Sadoulet and January (1995), stated that agricultural house-hold models suggest that farm credit is not only necessitated by the limitations of selffinance, but also by uncertainly pertaining to the level of output and time lag between input and output. Agricultural production plays a very important role in the vietnamese economy where approximately 800 /0 of the population live in rural areas with their main source of income from agriculture. (Ehui and Jabbar 1998). It is from the realization of this critical nature of agriculture that the government hinged its strategy for transforming the economy on improving the agricultural and rural section. One of the measures introduced by federal government is the establishment of agricultural credit guarantee scheme fund (Acgsf) established by decree No. '20 Of 1977. It's original share capital and paid-up capital were no million and N85.6 Million Respectively. The federal government holds 60% while the remaining 40% shares for central bank of Nigeria. The fund is managed by the central bank of nigeria which handles the day to day operations of the scheme. Another scheme established by the federal government is agricultural credit support scheme (Acss) which is an initiative of the federal government and the central bank of Nigeria with the active support and participation of the banker's committee. The scheme was introduced to enable farmer's exploit the untapped potential of Nigeria's agricultural sector. Another scheme established by the federal government is the nigerian agricultural, cooperative and rural development bank (Nacrdb) limited as the single largest development finance institution in Nigeria. Nacrdb is primarily for agricultural financing at both micro and macro level, as well as micro financing of small scale and medium scale enterprises. The bank is wholly owned by federal government having share capital fully subscribed by the federal ministry of finance incorporated. The banks mandate is the mobilization and timely delivery of affordable credit to meet the funding requirement of small-scale farmers in agricultural and non-agricultural sectors of the national economy. Other institutional arrangements were the establishment of the National Directorate of Employment (NDE), The Nigerian Agricultural Insurance Corporation (NAIC), The People's Bank O~ Nigeria (CPBN) The Community Banks (CBS) and the Family Economic Advancement Programme (FEAP).

1.2     Statement of the Problem

Agricultural credit which is meant to facilitate agricultural production and is met with constraints and the structure put in place to cater for the financial needs of farmers have to been able to alleviate farmers financial needs. Small-scale farmers are faced with enormous difficulties in acquiring credit facilities such as late disbursement of agricultural loans, non-fulfillment of security or collateral requirement necessitated bad debts, diversification of funds by' the banks management for non-agricultural purposes and inability of the banks to reach the small farmers at the grass root. Furthermore, since there is little or no managerial advice associated with acquiring these funds from informal sources, the problem of utilization of the available credit to cope with seasonal and annual fluctuations in income and expenditure arises. Therefore, the evaluation of credit use on the farm by small-scale farmers could provide the basis for recommending appropriate resources to minimize the constraints of small-scale farmers.

1.3     Justification of the Study

Onyebinama, (2000) reported that, it is important to note that credit allocation is influenced by several factors, which include the level of skill acquisition, type of technology as well as managerial and technical know-how. Unless loan are available on suitable terms to meet the credit need of farmers and the utilization of credit facilities effectively by the farmers. Majority of the small-scale farmers will not be able to improve farm productivity and increase income substantially. However, it is clear that major problem facing farmers in Nigeria is availability of credit facilities. It is only when these conditions are improved that the value of farmers output will meet their expectations that will bring about improvement in their standard of living. Moreover, this study will enable policy makers to known more of such sources of credit contributions to the agricultural sectors and how the farmers have been able to fully utilize such credits and achieve much from such a little number of helping hands. finally, this study will enable policy makers to know how small-scale farmers are actually utilizll1g the available loans from institutional sources so as to meet the desired impact on the farmers income and productivity.

1.4     Objective(S) of the Study

The broad objective of this study is to examine agricultural credit utilization among small-scale farmers in Bida Local Government Area of Niger State, Nigeria. The specific objective(s) are as follows;

i.        Determine the socio-economic characteristics of the small scale farmers.

ii.       To examine the pattern of credit utilization among agricultural loan beneficiaries.

iii.      To identify the major sources of credit to small-scale farmers.

iv.      To examine the benefits if (any) small- scale farmers had derived from the credit which the banks had given to them.

1.5     Hypothesis of the Study

The Null- Hypothesis State; that there is no significant difference in the income of farmers had access to credits and those without credit facilities from the banks.

i.        State Financial Aid:- These institution is to supplement what credit is made available to farmers from the private sources by supply agricultural credit through special department of its ministry of agriculture, or through cooperative societies. E.T.C. V.

ii.       From Foreign Organization:- The foreign institutional source like the world bank and the International Monetary Fund (IMF) give credit to governments to finance agricultural development projects.

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