Statistical Analysis Of The Role Of Micro-finance Bank In Agricultural Development

Statistical Analysis Of The Role Of Micro-finance Bank In Agricultural Development

Abstract

The study’s objective was to define the role of microfinance banks through statistical examination of the contribution of these institutions to agricultural growth. loans made to small-scale farmers in connection with the harvest. Secondary data were gathered using the ordinary least square method, and the regression analysis used the Durbin-Watson t-statistics. According to the study, microfinance bank loans have a beneficial effect on Nigeria’s agricultural development. The federal government should issue a directive through a microfinance bank that will encourage the farmers by providing them with incentives. Some recommendations were made based on these findings, including the reduction of interest rates to encourage farmers to borrow. As a result, farmers’ productivity will automatically rise, luring more young people into the industry.

Chapter One

Introduction

The project’s work is based on a statistical analysis of how microfinance banks have helped Nasarawa state’s agriculture improve.

A study that looked at three particular microfinance institutions found that they were crucial to the funding of various agricultural development initiatives. Microfinance is described by Schreiver and Columbet (2001) as a development technique used to give the economically active poor access to financial services.

1.1 The Study’s Background

One of the seven states that make up the north central geopolitical zone and the north central region of Nigeria, Nasarawa State shares an interstate border with Kaduna State to the north, the federal capital territory of Abuja to the west, Kogi, Benue State to the south, Taraba, and plateau State to the east, with Lafia serving as its capital.

Initially, Nasarawa State was a member of the northern area in the 1954 three-region system. It became a part of the Benue Plateau State in 1967 when General Yakubu Gowon’s military administration established 12 federal states. Nasarawa state was designated a part of plateau state by General Muritala Muhammed’s military regime in 1976, which increased the number of states from the original 12 to 19. In 1996, the plateau state was split into the current plateau state and Nasarawa state by the military administration of General Sani Abacha.

Numerous towns and cities were surrounded by a land mass, location, and population, including Lafia (Capital City), Akwanga, Dorna, Karu, Keffi, Nasarawa, and Nasarawa-Eggonand.

With a population of 1,863,275 (according to the 2006 census) and a density of 65 inhabitants per square kilometer, Nasarawa State accounts for 1.3% of Nigeria’s total population. The Magili people were among the first settlers and colonists of Nasarawa State. The name of the state is derived from one of the principal town administrative bodies, Nasarawa:

(Administrative Military) August 1998 to October 1996. August 1998 to May 1999: Baba Marde Administrator (military administrator) Governor Abdullahi Adamu (People Democratic Party), 29 May 1999–2007 AliyuDoma, a governor and member of the People’s Democratic Party 2007 to 2011 Gov.-civilian Umar TankoAlmakura has served as governor since may 2011 for the Congress for Progressive Change.

Cassava, yam, rice, corn, genie corn, beans, soy beans, and millet are the main crops farmed in Nasarawa State, which is nearly entirely made up of wooded land savannah and tall grass savannah. Agriculture is also the main occupation of the people who live there. Minerals found in the state include state coals, loonier, zinc, copper, columbite, barite, and aquamarine. Animal husbandry is a substantial commercial activity.

Education: Nasarawa State has a federal university in Lafia, a state university in Keffi, and several polytechnics, notably the Federal Polytechnic Lafia’s college of agriculture.

Farms, Ruwa Waterfall, Eggon Hills and Caves, PapeRuwa Lake, Kenna Salt Village, Doma Dam area Rock, and Alain Warm Springs are among the state of Nasarawa’s tourist attractions.

Cite this: Ames Welmers, 1934–1971.

Bank Microfinance

Beginning with one man and one village, microfinance Business owners were required to repay a large portion of their profit to loan issuers in 1976, therefore Muhammed Yunusa, a native of Bangladesh, founded Gramme Bank, which was the first microfinance bank. The idea of microfinance began when Yunusa gave his first microloan from his personal account to a group of women in a Bangladeshi village. His intentions were not to gorge the borrowers, but rather to give them reasonable loans with terms that would not impoverish them financially but instead encourage growth. The most underdeveloped areas of the world, such as sub-Saharan Africa and the democratic republic of Georgia, where some segments of the population could not normally have access to any kind of financial institution, can benefit from microfinance loans. To break the cycle of property in a region, opportunity international, a US-based non-profit organization that collaborates with microfinance lenders, suggests that in addition to small loans, individuals again support, such as education and training for personal development, in addition to savings and insurance products, In an underdeveloped area, a woman is less likely to get formal education, business training, or a prominent position in society, and without adequate financial support, she may never overcome these barriers.

Refer to Jonathan Morduch’s books, Economics of Microfinance and Longtime.

Agricultural, according to T. Steil Newman (1823), is a thing of law as such again. Any operation or revolution that is agriculturally oriented and fails to rural farmers is undoubtedly headed for failure, so if the microfinance bank across the globe is to direct their services and credits to the business sectors and the supposedly wealthy individual in the cities while the rural duelers (farmers) that matter are left out, we must keep in mind that we are not helping. A good economic and social growth that the country deserves depends on a well-organized and productive agricultural sector. A number of factors, such as the discovery of petroleum, the civil war, and the Saharan drought, have been blamed for the sharp decline in agricultural contribution to Nigeria’s Growth Domestic Product (G.D.P.). Despite these challenges, agriculture continues to provide the majority of the country’s food supply, raw materials for many Nigerians, and foreign exchange from the export of cash crops.

Refer to Lavelack.J.’s article in Thomason Renters (2009) Agricultural Vol. 39 No. 499-239-243.

Having the ability to borrow agricultural capital in any form for the purpose of investing in agricultural production, manufacturing, or other agricultural activities is referred to as having an agricultural loan.

Situation Of The Problem

Despite that microfinance banks lend to farmers and the quantity production of the chosen crops, agricultural activities carried out at various levels and fields continue to face a number of challenges. These challenges have an impact on the production of foods, poultry, and other agricultural activities. Knowing all these challenges, the researcher seeks to determine whether the loans made to farmers are adequate.

1.3 Purpose And Goals Of The Study

The purpose of this study project is to determine whether loans provided to farmers enhance agricultural development in an effort to lower the rate of imported goods. It also aims to determine whether there will be a rise in the number of people applying for loans in the near future. Having the following goals:

to contrast the chosen crops’ levels of output.

Analyze the microfinance banks’ loan distribution trends.

estimation of the number of farmers who will receive loans.

to predict the quantity to be allocated to different crops

to determine its relevance or lack thereof.

1.4 The Meaning Of The Study

Farmers and microfinance banks would both benefit from the research since it will enable them to pinpoint where the banks are at fault and where they need to make adjustments. It is also considered to be crucial to the society’s planning and loan implementation. By establishing more microfinance banks, the society or community will be able to ascertain how the other farmers will react to this economic contribution or in restrictions. Having complete control over their actions and the formulation of policies with regard to agricultural activity.

1.5 Restrictions To The Study

This study is limited to three particular microfinance institutions in Nasarawa State between 2000 and 2015.

1.6 Research Problem

The following is set up to help the researcher get closer to finishing this project successfully.

1.6 The Study’s Hypothesis

In Nigeria, the development of agriculture is not significantly impacted by microfinance bank loans.

1.7 Limitations of the research

Only the records of loans granted by microfinance banks are allowed to be utilized as data for the research project, and this restriction is because

There aren’t enough microfinance institutions in the research area. Other restrictions on the study are due to time and budgetary limits, which were encountered when putting the data and materials together.

1.8 Term Definition

Loans are sums of money lent to individuals by banks with the intention of repayment at a certain time with interest on the capital given.

Outside clients are liable for the bank’s assets.

Banks’ resources are known as their assets, which can be either fixed or current.

A bank is a type of financial institution that manages customer deposits of money.

Population: The group of entities from whom decisions and inferences are to be drawn and a sample taken

Sample: Is a member of the population under study, from whom conclusions about the entire population can be drawn.