Performance Assessment of Ogun State Agricultural and Multi-Purpose Credit Agency (OSAMCA) in Credit Delivery and Operation (2004-2006)

Abstract

Lack of credit facilities has always been regarded as a major problem of small-scale farmers and other micro-entrepreneurs in Nigeria as in most developing countries worldwide. This has been attributed to non-availability of collateral securities and inadequate information that prevented this category of people from accessing credit facilities. Nigerian farmers in recent times have witnessed immense involvement of micro-credit institutions by accessing credit facilities without demands for collaterals and at concessionary rate of interest.  Hence, micro-credit schemes in Nigeria are becoming popular and agricultural credit options are changing and expanding with innovative products in which farmers are offered different alternatives. However, their performances have been met with mixed results. This study is therefore aimed at evaluating the performance of the Ogun State Agricultural and Multi-purpose Credit Agency (OSAMCA). The assessment was conducted to see the volume of loan disbursed, rate of the Agency’s growth, the number of farmers empowered as well as the general outlook in credit delivery and operations by the Agency. Within the three years (2004-2006) of operation, 1216 farmers benefited through eight different agricultural enterprises; from N73, 228,038.00m at 12 percent interest charge, at an average of  N 24,409,346.00 per zone for all the enterprises and N 60,220.43 per beneficiary; over the study period. It was however recommended that Bank linkages and self-help Groups should be initiated to improve and sustain credit flow to the agricultural sector. In addition, there is a need for innovative strategies that are aimed at reducing transaction costs of delivery and access to loans.