Regionalising Loan Repayment Capacity of Small Holder Cooperative Farmers in Nigeria: Exploring South-South Nigeria

Abstract

This paper examined the repayment capacity of small holder cooperative farmers in South-south region of Nigeria. A composed sample of ninety-six respondents randomly selected from sixteen cooperatives from eight local governments in Bayelsa and Delta states made up the sample. Descriptive statistics and Multiple regression analysis were used to achieve the study objectives. The result shows that age, education level, loan size, repayment period, net farm income, loan supervision, engagement in other jobs as well as farm size has positive influence on loan repayment capacity. Also, gender, marital status, household size and the amount expended on hiring equipment have negative influence on loan repayment capacity. The author recommends that there is the need to improve access to farm implement and fertilizer as this will help to increase farm yield and consequently the net farm income of the farmers which the study has shown will improve the repayment capacity of the farmers. Also, pertinent that effective loan supervision mechanisms be put in place to ensure loan repayment compliance. More loans should be advanced to females. Government should subsidize farm equipment or at best grant waiver to farmers who want to import such equipment. In addition, government should do well to offer preferential interest rate to small holder farmers.

Key words: Loan Repayment Capacity, Small Holder  Cooperative Farmers