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Effects of Financial Inclusion on Ownership of Productive Assets among Cassava Processors in Oyo State, Nigeria

S. B. Ibrahim
R. O. Aminu
A. O. Arowolo
A. M. Oyedele


This study investigated the level of productive asset ownership and the effects of financial inclusion on the ownership of productive assets among cassava processors in Oyo State, Nigeria. The study utilized primary data from 336 cassava processors selected through a multistage sampling procedure in Oyo State. Data were analyzed with descriptive statistics, principal component analysis to generate the respondents' index of productive assets ownership, and an ordered logit regression model to determine the effects of financial inclusion indicators and other socio-economic characteristics on respondents' level of asset ownership. The estimated cassava processing asset ownership index revealed that most respondents have a low level of cassava processing asset ownership. Specifically, ownership of important cassava processing assets like grinding machines, hydraulic pressers, and drums was low compared to the respondents' ownership of sieves and frying pots. The estimated coefficients of the ordered logit regression model indicate that financial inclusion indicators importantly and positively influence the likelihood of productive asset ownership. The ownership of bank accounts, bank savings, and improved credit access will significantly increase the probability of cassava processing asset ownership. Similarly, the possibility of cassava processing asset ownership was found to also increase with the increase in age, male gender, cassava land area cultivated, household income, native residency status, and household size, among others. Thus, this study recommends that the government and other relevant stakeholders make credit facilities more available and accessible to cassava processors. The cassava value chain actors should also be encouraged to adopt formal banking services. This will enhance the level of financial inclusion in the cassava value chain in the country while also helping to improve the respondents' investment in the necessary cassava processing assets to enhance the efficiency and profitability of the cassava processing value chain in Nigeria.