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Matching Credit with Season: An Issue for Non Performing Agricultural Loans in Nigeria

Author

Listed:
  • Ekong, Christopher N.
  • Onye, Kenneth U.

Abstract

This paper empirically investigates the performance of Nigeria’s agricultural credit policies with a view to unearthing the factors responsible for the poor loan performance. The findings reveal that although Nigeria’s agricultural sector is abysmally underfunded with an unproductive federal budget structure that have been detrimental to agricultural productivity, the basic factor responsible for poor loan performance has been the failure to match credit with seasons. From the analysis of loans and disbursement flow to agricultural sector, it was discovered that loan are paid to farmers with utter disregard to the seasons. Evidently, the mismatch of credit disbursement with seasons attenuated growth and productivity of agriculture in Nigeria, resulting in poor loan performance. We recommend the adoption of the seasonality model, an innovative strategy, which is capable of solving the problem of default in agricultural financing and as such aiding the process of enhanced agricultural productivity and national development.

Suggested Citation

  • Ekong, Christopher N. & Onye, Kenneth U., 2013. "Matching Credit with Season: An Issue for Non Performing Agricultural Loans in Nigeria," MPRA Paper 88306, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:88306
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    References listed on IDEAS

    as
    1. Eze, Christopher C. & Lemchi, J.I. & Ugochukwu, Albert I. & Eze, V.C. & Awulonu, C.A.O. & Okon, A.X., 2010. "Agricultural Financing Policies And Rural Development In Nigeria," 84th Annual Conference, March 29-31, 2010, Edinburgh, Scotland 91677, Agricultural Economics Society.
    2. Ekong, Christopher N. & Onye, Kenneth U., 2012. "Economic Development in Nigeria: The Basic Needs Approach," MPRA Paper 88189, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Agricultural loans; Nigeria; Seasonality Model; ACGSF;
    All these keywords.

    JEL classification:

    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

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