ABSTRACT

This research work is set out to carry a critical look at the impact of bank lending to small scale farmers in Isiala Ngwa North Local Government Area. The specific objectives include to identify the socio-economic characteristics of respondents, the determinants of credit procurement and problems of credit procurement. Data were collected through the use of a well-structured questionnaire administered to 80 farmers in Isiala Ngwa North Local Government Area who have benefited from the rural credit. Besides, of the 80 respondents 50 were males and 30 were female. Data analysis was done with the use of percentage and multiple regression analysis. The result of the multiple regression indicated that factors which determine credit procurement by farmers were age, interest rate, distance, farm size and farm income which were all positive at I % significant level expect the interest rate which was negative. Problems facing farmers borrowers included non-availability of collateral, difficult and delay in securing loan, distance between home and source of loan, inadequate supervision, minimum saving with the bank, rising cost of inputs, low market price of output,diversion of loan for other uses, natural disaster, maturing period of loan, high interest rate and time of loan disburseinent. Based on these results, adequate policies and programmes should be designed that will help in credit use and administration. There should be an improvement in the time and disbursement of loan, maturing period should be increased and released and release of adequate fund and opening up of rural branches of banks to improve contact with farmers.