Econometric study of farmers' patronage of financial institutions in Ikwuano local government area Abia State, Nigeria

Abstract

The study examined the factors militating against patronage of financial institutions in Ikwuano Local Government Area of Abia state and the perceived constraints to banking. A total of 100 respondents were selected using the purposive random sampling technique, from ten villages in the local Government Area in 2003. Data were collected using well-structured questionnaire. The Pearson's Product Moment Correlation Coefficient r was used to determine the relationship between farmers' socioeconomic characteristics and bank patronage. Likert scale was used to determine the constraints to bank patronage. Results show that the level of education and income have positive relationship with bank patronage. Major constraints to bank patronage identified in decreasing magnitude of importance are: distance to the bank (3.68), inability to read and write (3.55) and lack of awareness of what it takes to save in a bank (3.61). it is recommended that rural branches of banks where non-existent be established or reactivated. Favourable polices should be adopted by banks, more awareness should be created to educate the stakeholders populace and small scale farmers should be encouraged to belong to organized farmer groups. International Journal of Agriculture and Rural Development Vol. 7(2) 2006: 33-39