oer | Ambrose Alli University

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The study empirically analyzed the effects of micro credit on cassava production in Edo state and compared micro credit beneficiaries and non-beneficiaries. It focused on the examination of socio-economic characteristics of the respondents, the volume of loan requested, amount granted and amount repaid, the profitability of the enterprise by the two groups of farmers, the determinants of their profit, examination of resources use efficiency and the constraints affecting the farmers. Multistage sampling technique was adopted in selecting one hundred and eleven (111) micro credit beneficiaries and one hundred and seven (107) non-beneficiaries. Data were collected through the administration of structured questionnaire for the literate respondents and an interview schedule for the illiterate respondents. Data were analyzed using descriptive statistics, budgeting analysis, inferential statistics, using production function analysis, marginal value productivity analysis and a three (3) point Likert scale for the constraints rating. The results showed that farming operations were dominated by the males (91.9%) for beneficiaries and (83.2%) for the non-beneficiaries and they were literate farmers. Majority of them had no extension services (80.2% of beneficiaries and 95.3% non-beneficiaries). They cultivated small size farm holdings ( for the beneficiaries and ( for the non-beneficiaries. Only two socio- economic characteristics (family size and farm size) had significant difference (P <0.05). Cooperatives were the major source of credit (60%) for the beneficiaries. There was great disparity between the amount requested and the amount granted, the difference was significant (t =P< 0.05). The business was more profitable for the beneficiaries than the non-beneficiaries and the difference in the profit was significant (t=P<0.05). The Cobb-Douglass production function provided the best-fit equation. Five (5) of the variables were found to be significant determinants of the beneficiaries’ profit (P<0.05) while four (4) variable were the significant determinants of the non-beneficiaries’ profit (P <0.05). No resources were efficiently used in cassava production by the credit beneficiaries while one resource was efficiently used by the non-beneficiaries. The serious constraints affecting the beneficiaries were, transportation ( , land scarcity ( , late timing of granting loan ( , smallness of loan granted ( and high cost of labour ( . For the non-beneficiaries, serious problems were: lack of access to micro credit ( , transportation ( , land scarcity , and high cost of labour . In conclusion access to micro-credit could be of immense benefits to cassava farmer as it could enable them to expand their holdings, reduce cost of operation, achievement of higher returns and economies of large-scale production. It recommended for the formation of farmers’ cooperative society and more favourable access to credit facilities.