Solomon C. Udah, Charles K. Osondu and Sylvia C. Nnajiofor
J. Agri. Res. Adv., 03 (03):26-35
Solomon C. Udah: Department of Agricultural Economics and Extension, Abia State University, Nigeria
Charles K. Osondu: Department of Agricultural Economics and Extension, Abia State University, Nigeria
Sylvia C. Nnajiofor: Department of Agricultural Economics and Extension, Abia State University, Nigeria
Article History: Received on: 07-Jul-21, Accepted on: 30-Sep-21, Published on: 02-Oct-21
Corresponding Author: Solomon C. Udah
Email: christdliberator@yahoo.com
Citation: Udah SC, Osondu CK and Nnajiofor SC (2021). Impact of informal agricultural credit on food security status of rural farm households in Enugu state, Nigeria. J. Agri. Res. Adv., 03 (03):26-35
Aim: The study was aimed to evaluate the impact of
informal agricultural credit on food security status of rural farm households
in Enugu state, Nigeria.
Materials and Methods: Multistage random sampling was used to select 240
rural farm households from whom data were collected using semi structured
questionnaire. Data were analyzed using descriptive statistics, food security
index, z-test and probit regression.
Results: The Results showed that farm households applied for ₦95,690.54 from informal sources but received ₦52,885.86 as informal credit. Result further showed
that farm households had access to credit from friends/relatives (X = 3.86),
daily/weekly contribution scheme (X = 3.51) and rotating joint contribution
scheme (X = 3.16). Food security line, food insecurity incidence, food insecurity
gap and food insecurity severity of the farm households were N9,612.31, 0.4228,
0.3873 and 0.2640 respectively before access to informal credit, while after
access to informal credit, food security line, food insecurity incidence, food
insecurity gap and food insecurity severity of the farm households were
N12,202.19, 0.3162, 0.2369 and 0.1907 respectively. Z-test analysis showed that
access to informal credit impacted significantly on food security line and food
security incidence of farm households. Result of Probit regression analysis
showed that gender of household head, level of access to informal credit,
education level, extension access, farm income and household size were
significant determinants of farm households' food security status.
Conclusion: It was concluded that access to informal credit had
significant impact on farm households food security status.
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