ABSTRACT
The purpose of this study was to examine the determinants of credit acquisition in lkole local government area and its effect on their output. Specific objectives are to describe the socio-economic characteristics of the farmers, identified the sources of credit available to the farmers, identify problems that constrain farmers from agricultural credit acquisition, evaluate the effect of using credit on farmers output. Data collected were analysed using descriptive statistics, multiple regression analysis, gross margin analysis and the study hypothesis was tested with the independent t-test. The result showed that majority (84%) of the respondents were males with a mean age of 47 years. 98% of the farmers have formal education, 89% were married with majority have large households of above 5 persons. Majority (79%) are full-time farmers while the rest are secondary farmers. Majority (48%) could source for credit from friends and relatives, 33% from cooperative societies, 6% from money lenders and 13% from formal sources. The result of the multiple regressions indicated that age, household size, marital status, education level, occupational status, farm size at varied signs and levels as significant predictors of amount of agricultural credit acquired by farmers. The constraints to credit acquisition as perceived by farmers include: mode of repayment, non-membership of cooperative society, high interest rate, lack of collateral security, complex processing procedure and lengthy time to process loan. The result shows the mean profit margin of users at N138,930 and N126,412 for non-user with a t-value of 18.417 and 9.639 respectively. This implies that credit use would best determine the profit margin of farmers in the study area.
