EFFECT OF MICROCREDIT ON THE PERFORMANCE OF AGRIPRENEURS IN KATCHA LOCAL GOVERNMENT AREA OF NIGER STATE, NIGERIA

Abstract

External financing sources, especially for small businesses can be a crucial part of their expansion and sustainability, and for those operating within a struggling sector such as agriculture, this is particularly true for agripreneurs. This study is an empirical inquiry into the role microcredit plays on the performance of agripreneurs, with particular focus on businesses operating in Katcha Local Government Area (LGA) of Niger state. This was achieved in a cross-sectional analysis involving the collection of primary data from a cluster sample of 482 agripreneurs in the LGA. The study data was obtained in a questionnaire survey, in which copies of a structured questionnaire were administered to participants to collect their views and opinions on microcredit, as the independent variable, and productivity, profitability and risk management capacity, as dependent variables, and disaggregated components of performance. Questionnaire items formed indicators for their respective variable scale. Data obtained was used to estimate a path model, via Structural Equation Modeling (SEM), to test variable relationships. Findings arrived at from the analysis indicates that microcredit exerted positive and significant effect on all three components of performance. It was therefore, recommended that microcredit programmes should have an incorporated land leasing component to take care of low productivity issues.