Upcoming Seminar on Credit Rationing – August 21st in Abuja

On behalf of IFPRI Nigeria, I am pleased to invite you to attend a seminar about credit rationing in the agricultural sector on August 21st in Abuja. The seminar, titled "Agricultural Finance Renaissance in Nigeria and Emerging Patterns of Credit Rationing" will be presented by IFPRI Senior Economist/Consultant Dr. Aderibigbe Olomola. During the seminar you will learn more about the reforms in agricultural financing since the early 2000s, the extent of credit rationing on farmers, and the factors influencing this practice.

Date: Thursday, August 21, 2014
Time: 2:00PM - 4:00PM
Venue: IFPRI/IFDC Conference Room
No 6/Plot 1413 Ogbagi Street; Off Oro-Ago Crescent,
Cadastral Zone II, Garki II, Abuja-Nigeria
(Near Old CBN building and behind Union Homes)
RSVP: Please email a.y.bashir@cgiar.org before the 19th of August

We apologize, but we are unable to provide transportation stipends to attend this event.

Abstract:

The credit market serving agriculture in Nigeria is encumbered by operational and administrative inadequacies and discriminatory tendencies of financial institutions. The government has put in place policies to redress the situation but the small-scale farmers have not benefited from these incentives to any reasonable degree. This study seeks to (i) review the reforms in agricultural financing since the early 2000s and the opportunities presented for increased involvement of the banking sector in channeling funds to the agriculture sector, (ii) ascertain the extent to which the farmers are credit rationed and the factors influencing the emerging rationing scenarios; and (iii) proffer policy measures to address the problem of agricultural credit rationing. The study employed primary data obtained from 1,200 small-scale farmers through a survey conducted in 2013 across six geo-political zones of the country. Methodologically, the study extends the analysis of credit rationing beyond quantity rationing and presents explicit econometric models for analyzing the determinants of three types of credit rationing - quantity rationing, risk rationing and price rationing. The seemingly unrelated regression (SUR) model is employed to ascertain the determinants of credit rationing. The results show that there is a higher probability of farmers being rejected than being given an amount of loan lower than what has been requested. We found that there is no statistically significant difference in probability that farmers will be quantity rationed on the basis of gender, geographical location, and marital status. To address the credit rationing challenges we enjoin banks to mobilize resource to train potential borrowers and set up loan monitoring committees at the grassroots level to serve as insurance against the risk of loan default.

Prof. Olomola's Bio:

Prof. Olomola is a Senior Economist/Consultant under the Nigeria Strategy Support Programme of the International Food Policy Research Institute (IFPRI) Abuja, Nigeria. Prior to this, he has been working at the Nigerian Institute of Social and Economic Research (NISER) from where he is currently on leave. At NISER, he has been Head of the Macroeconomic and Strategic Modeling Unit, Head, Research and Consultancy Unit, Director, Agriculture and Rural Development Department, Editor-in-Chief of NISER’s Journal – Research for Development- and Director of the Surveillance and Forecasting Department of the Institute.
A renowned international scholar, Prof. Olomola was a winner of the prestigious Fulbright Senior African Scholar Award in 1994/95 and to date he remains an Academic Adviser to the Sweden-based International Foundation for Science (IFS). He was a member of the African Capacity Building Foundation (ACBF) Technical Advisory Panel and Networks (TAPNETs) and also a member of the African Union (AU) Task Force on the Establishment of African Research Council (ARC) in 2010/2011.

A prolific writer, Prof. Olomola has numerous publications including books, book chapters, monographs and articles in national and international Journals and has wide-ranging experience in consultancy activities. He has consulted for several organizations including the World Bank, UNDP, ILO, FAO, IDEP, UNU-WIDER, IFPRI, CIDA, ODI, ACBF IIED and AERC all in the areas of agricultural and development economics.