Impact of Deposit Money Bank Loan on Agricultural Productivity in Nigeria

In transforming the economic situation of Nigeria, the impact of agriculture cannot beoveremphasized. Agriculture was the primary foreign exchange earner for Nigeria, until themid-seventies when it lost its prime position to the mineral sector. One important factoraffecting agricultural sector productivity is inadequate capital. The objective of the study isto evaluate the impact of agricultural financing policy and deposit money bank loans toagricultural sector on agricultural productivity. The study used time series linear regressionmodel employing data covering the period of 2010 and 2022. The result revealed that depositmoney bank loans (CBF) and agricultural financing policy proxy by Agricultural CreditGuarantee Scheme Fund (ACGSF) have significant positive impact on agriculturalproductivity in Nigeria while lending rate (LR) shows a significant negative impact onagricultural productivity. It is recommended that commercial bank should complement theagricultural financing policy of the government by making agricultural finance accessible,easier and at low rate of interest for farmers. Farmers should also be sensitized on the benefitof accessing funds from the policy and banks to enhance productivity. The study furtherrecommends that government should encourage financial inclusion for the farmers.Keywords: Agricultural Financing, Deposit Money Bank, Lending Rate, AgriculturalProductivity.