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Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria,

Authors: BALOGUN Olubunmi

Publication Type: Journal article

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Abstract

This paper examines critically the key factors influencing demand for micro credit among rural households in Ekiti and Osun states, Nigeria. A multistage sampling was employed for the study. Ekiti and Osun states were randomly selected from the six states in South-western Nigeria. This was followed by random selection of two Local Government Areas (LGAs) from each senatorial district of the states. Thirty microcredit groups (MGs) were randomly selected from each of the selected LGAs based on probability proportionate to the size of the MGs. Lastly, 399 respondents were randomly selected from the MGs. Data on household demographic characteristics, social capital and microcredit variables were collected with structured questionnaire. The data were analyzed using descriptive and multinomial logit model. The microcredit granted was N15, 739.35Â±N1, 026.81 representing only 44.2% of the total credit needs of households. The time lag for credit was 4.65Â±3.35 weeks with a payback period of 7.30Â±4.63 months. The result of multinomial model shows that household social capital variables (membership density index, meeting attendance index, cash contribution index & heterogeneity index), dependency ratio and credit variables (credit distance & interest rate) significantly explained households demand for credit. Social capital variables significantly influenced the amount of credit available from different sources. Our analysis suggest that policy makers interested in improving the living conditions of households may be advised to consider promoting social capital through group as one relevant ingredient to achieve the Millennium development goals of reducing poverty by half

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BALOGUN,O. . (0000). Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria,, 0 (), 0-0.

BALOGUN,O. . "Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria," 0, no (), (0000): 0-0.

BALOGUN,O. and . (0000). Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria,, 0 (), pp0-0.

BALOGUNO, . Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria,. 0000, 0 ():0-0.

BALOGUN,Olubunmi , . "Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria,", 0 . (0000) : 0-0.

B.Olubunmi , "Determinants of Demand for Microcredit among the Rural Households in South-western states, Nigeria," vol.0, no., pp. 0-0, 0000.

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