The Role of Financial Institutions in the Financing of Agriculture in Nigeria

Abstract

Financial institutions play fundamental roles in the development and growth of all sectors of the Nigerian economy including agriculture. In this regard, the need of agricultural sector financing becomes imperative if agricultural development is to be achieved. However, the Nigerian agricultural sector (an important source of income, employment, raw materials, foreign exchange and markets) is dominated by peasant farmers, who operate under small-scale systems with meager capital outlay, hence its stagnated growth. This therefore, calls for an intervention by financial institutions to resuscitate the dwindling agricultural sector. This paper therefore, identifies the key financial institutions that participate in agricultural financing delving further into their operations and constraints in the Nigerian economy.