Effects of trust fund model credit intervention on welfare of farmers’ households in Oyo State
Over the years, successive governments in Nigeria prioritized agricultural sector in credit policies by establishing numerous agricultural credit programmes including Trust Fund Model (TFM). Several years on, TFM production cycles have been completed and its benefits on welfare of farmers is expected to be obvious. This study therefore investigated the effects of TFM on farmers’ households’ welfare in Oyo state. Simple random sampling was used to sample 40% of the beneficiaries resulting in selection of 134 beneficiaries. Using interview schedule, data was collected on beneficiaries’ socioeconomic characteristics, level of awareness of the TFM components, constraints in accessing TFM funds and beneficiaries’ households’ welfare status. Data were analysed using descriptive (frequency, percentages and mean) and inferential (Chi square and PPMC) statistics at p=0.05. Results reveal that beneficiaries were aged 53±11.0 years, mostly male (85.2%), married (95.1%) and with household size of 6±3.0 persons. Amount of TFM funds received by beneficiaries was N295,655±154,149. Less than half (41.8%) of the respondents were highly aware of the components of TFM and were severely constrained by delay in processing of Interest Draw Back (0.74±0.88) and in release of disbursed funds (0.71±0.77). Per Capita Expenditures (PCE) of N504, 816±420,330.00k suggest that 63.9% of the respondents belonged to core poor category. It is concluded that the TFM had not impacted positively on the beneficiaries. It is therefore recommended that the administrative bottlenecks associated with fund release and processing of interest drawback be addressed. Also, amount loanable should be increased, while condition of collateral counterpart funding be relaxed.
Keywords: Agricultural credit, Per capital expenditure, Core poor, Household welfare