AGRICULTURAL CREDIT. UTILIZATION AND RECOVERY: A CASE STUDY OF THE NATIONAL LIVESTOCK PROJECTS DIVISION IN ONDO STATE

Abstract

The Nigerian livestock industry holds the key to the problem of inadequate animal protein consumption by Nigerians. But it is finding it difficult to function properly due to inadequate capital among other problems. Most livestock farmers do not have adequate capital by way of savings nor do they have access to adequate and acceptable credit. Government therefore attempted to address the problem through the establishment of the National Livestock Projects Division (NLPD) loan arrangement. This programme operates in all State of the Federation, Ondo State inclusive. This study therefore attempted to evaluate the programme through the following specific objectives; I. To determine if credit size related significantly with farmers income; II. To relate loan utilization by individual borrowers to loan repayment; lll. To find out whether significant differences exist in loan repayment among borrowers of different personal characteristics, livestock financed, and different loan repayment demand visit levels; and IV. To determine if significant relationships exist between loan repayment and profitability. 150 individual livestock NLPD farmer programme participants from 14 Local Government Areas of Ondo State were randomly selected for the study. These were reached and interviewed using a structured interview schedule. Data was subjected to appropriate statistical analysis including frequencies and percentages, pearson correlation and one-way ANOYA. Findings indicated that mean age of farmers was 40.5 years. A total of 40.7% had Polytechnic or University degrees by way of highest educational qualification. Majority (62.7 %) were government officials with model family size of 4 members. Livestock production. enterprises financed included Mean loan size was N7,275.10. Goat. Poultry, Pig, Sheep and Cattle Mean credit staff visit to farmers was 3.4. Net enterprise income had a mean of N 109,012.60. Loan size did not significantly correlate with farmers income (r=0.10). Loan fund diversion rate was a maximum of 20.75%. It involved only 11.3% of the borrowers. Loan utilization did not affect loan repayment. Loan repayment did not significantly relate to age (r=0.19), education (r=0.05), and social status (r=0.18). It did not also differ significantly among farmers of different ages, education and social status. Among different livestock classes financed, loan repayment did not vary significantly. Among different enterprises financed loan repayment, subjected to one way ANOYA with an F value of 5.04 which was significant at 1.0% level. There were neither significant correlations nor differences between loan repayment and credit officers supervisory visit as well as loan repayment demand visits. Loan repayment however significantly and positively correlated with profitability (r=0.95).