Downloading: Determinants of Loan Default and Repayment Rates by Cassava Farmers in the South-South Nigeria: A Case Study of Bank of Agriculture and Union Bank
International Journal of Science and Research (IJSR)

International Journal of Science and Research (IJSR)
www.ijsr.net | Open Access | Fully Refereed | Peer Reviewed International Journal

ISSN: 2319-7064



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Determinants of Loan Default and Repayment Rates by Cassava Farmers in the South-South Nigeria: A Case Study of Bank of Agriculture and Union Bank

Kuye Olufemi Oludayo, Chukwu Victor Amoge, Awoke Matthew Ugota

Abstract: Financial institutions play vital roles in extending agricultural credit to Nigerian farmers which transform their socio-economic activities through increased output of crops, especially the staple food crop, cassava. This study was carried out in order to ascertain the determinants of loan default and repayment rates by cassava farmers loan beneficiaries in Bank of Agriculture and Union Bank in South- south Nigeria. Purposive and multi-stage random sampling techniques were used to select a total of two hundred and fifty (250) cassava farmer loan beneficiaries across the states in the South-south Nigeria. The findings revealed that UB gave the highest amount of N3, 779, 534, 400.00 (60 %) while BOA gave N1, 671, 497, 140 (26 %). Further analysis revealed high repayment rate of 97 % and 91 % by large scale cassava farmer loan beneficiaries in BOA and UB. Major constraints limiting loan administration by bank officials were non-repayment of loan by beneficiaries (100 %), and delay in repayment of loan (100 %) among others, identified by the banks officials. It was recommended that approved loans should be disbursed on time and monitoring and evaluation of loans disbursed should be done regularly and on time, among other recommendations.

Keywords: Agricultural loan, default rate, repayment rate, cassava farmer loan beneficiaries, BOA, UB, South-south Nigeria



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