AN EVALUATION OF THE IMPACT OF IFELODUN MICROFINANCE BANK IKIRUN ON AGRICULTURAL DEVELOPMENT IN IFELODUN LOCAL GOVERNMENT AREA
The project examines an evaluation of the impact of Ifelodun Microfinance bank Ikirun on agricultural development in the Ifelodun Local Government. Introduction, purpose, and limitation of the study, etc were examined. Ideals with development of Agricultural Financing in Nigeria objective, scope, literature review, the role of agriculture in economic development and solution to the problem facing them. That is research methodology and process of data collection were examined. Exposed the financing data analysis and data collecting and also analyzing of response from respondent from Microfinance bank which was critically review. Conclusion base on the summary of findings and recommendations to the general public at large.
BACKGROUND OF THE STUDY
Nigeria is a country that is enclosed by nature with all the resources that facilitate Agricultural Development. These include Vast Kinds of areas, rich soil, plenty of rainfall, and hardworking peoples. Nature has been generous to this country. So when Nigeria attained Independence in 1960, agriculture was the dominant sector of the economy. It constituted over 65% of the country’s gross domestic product (GP) and provided the bulk of foreign exchange earnings through the export of cash crops. It is therefore little or no wonder that pivot of discovery of oil. This country has been a great exporter of farm produce as groundnut, cocoa, palm cannel and oil, cotton, and rubbers.
The overall agriculture deteriorated creating a wide gap between supply and demand for food and revenue from agricultural export demanded. So the government was faced with mouthing food import bills at the same time, industries, increasingly restore to importing agricultural raw materials. In order to tackle some problems facing the agricultural sector, the federal government and central bank of Nigeria (CBN) put in place certain policies no respect agricultural financial through:
The establishment of a specialized financial institution like The Nigeria Agricultural and Micro Finance Bank (NAMB), Peoples bank among others, and control policy under the policy of commercial merchant Bank of Nigeria (CBN) through monetary policy circular to lend a certain percentage of their loan portfolio to farmers and agro-based industrialist.
Their establishment of a special scheme like the agricultural credit guarantees Scheme (ACGS), the Nigeria agricultural insurance, company (NAIC), Small and Medium Scale Enterprises (SME), were established to supplement the activities of specialized financial institutions in credit delivery. Since finance is a key element for the modernization of agricultural and agro-allied business, because necessary to study the contribution of microfinance banks on Agricultural Development with special reference to Ifelodun Microfinance Banks Ikirun Osun State.
STATEMENT OF THE PROBLEM
The contribution of microfinance banks to Agricultural Development can not be over-emphasized in the development of any state or country particularly at the local government level.
Agricultural contribute greatly to the revenue generation and the economic growth and development of the local government and individual.
In view of the laudable contribution of microfinance Bank to Agricultural development, it is necessary to examine these contributions in Osun State with particular reference to Ifelodun Local Government area Ikirun.
The statement of hypothesis includes null hypothesis (Ho) and alternative hypothesis (Hi). They are as follow:
Ho: Ifelodun Microfinance Bank's contribution to Agricultural development is not significant.
Hi: Ifelodun Microfinance Bank's contribution to Agricultural development is significant.
Ho: There is no significant relationship between microfinance Bank and Agricultural development at Ifelodun Local government Area.
Hi: There is no significant relationship between microfinance Bank and agricultural development in Ifelodun Local Government.
PURPOSE OF THE STUDY
Despite the federal government and central bank of Nigeria's (CBN) policies in respect of agricultural financing in Nigeria. The sector still remains in picturing of shoddy performance. Therefore, it is imperative to study the role of microfinance banks in financing through agricultural credit guarantee scheme (ACGS).
SCOPE OF THE STUDY
The study covered the contribution of microfinance banks to agricultural development in the Ifelodun local government area.
It will look at the general overview of microfinance banks' contribution to agricultural development in Ifelodun local government area Osun State.
LIMITATION OF THE STUDY
In considering the wideness of this topic or study the extent to which we intend to treat the topic is insufficient to supply of textbooks, the time factors, financial constraints, distance, and inadequate information given by the banks and farmers.
SIGNIFICANCE OF THE STUDY
The study has become relevant to the academic community and society in general. Microfinance contribution to agricultural development in Ifelodun local government area makes the society in general known the contribution of microfinance bank to agriculture in Nigeria.
Also, the academic community and society will benefit when there is an increase in the development of agriculture through financing by microfinance banks.
DEFINITION OF TERMS
i Agricultural: Refers to the production of foods and cash crops.
Ii Funds: This can be simply referred to as money or anything that can be used for the settlement of debts.
iii. SME: Small scale medium
iv. NAIC: Nigeria agricultural insurance company
v. Lending: This is the act of given out money and collect it back on a specified date with interest.
vi. Agroallied: This is the chemical used in agriculture in order to prevent any pesticides like rodents, birds e.t.c.
vii. NACB: Nigeria Agricultural and Cooperative Bank.
viii. Interest Rate: This is the amount charged on any given out at a specific period of time.
ix. Financing Opportunity: This refers to finance available with the business, either injected by owners as equity and director loan.
x. Formal Sectors: This consists of some components like the banking system, the capital market, non-bank financial institutions.
xi. Informal Sector: This consists of money lenders, trade association, age grade association..