Modelling Loan Accessibility among Women for Economic Development

Abstract

The ability to start an investment is usually enabled by access to available and adequate finance. The contributions of both males and females are known to correlate with economic growth and sustainable development across countries of the world. However, in recent times, there has been growing concern about the inability of women gender to make substantial contributions to economic development despite their potentials. The paper investigates the factors that affect women's access to loan in Akure, Ondo State, Nigeria. The target population comprises of lending institutions in the study area. Data on 140 women loan applicants were purposively sourced from the databases of the selected lending institutions (commercial and microfinance banks) with forty loan applicants in the loan accessed category and one hundred of them in the loan non- accessed category. Descriptive statistics, independent t-test statistics and logistic regression analysis were adopted in analysing the collected data. The result of the descriptive statistics reveals that minority of the respondents had tertiary education while majority of the respondents either have no formal education or elementary education, the result of the independent t-test reveals that the mean values of education, income, possession of real estate as security are significantly higher in women with access to loan than women without access to loan. Furthermore, the result of logistic regression analysis reveals that applicant income, women in government work, women with tertiary education, being a married woman, year of relationship with bank and possession of collateral assets have positive significant effects on loan accessibility among women loan applicant while women in private/self-employed women, low level education, loan amount, loan duration and having history of default have inverse significant effects on women loan accessibility. Analysis of EXP(B)value of variable marital status is 7 times most likely to belong to women with access to loan while EXP(B)value of women with low educational level are 15 times most likely to belong to the group of women without access to loan. For women to be more properly integrated for economic development special financing arrangement should be put in place. The findings of the current study serve as inputs for decision makers/ policymakers, and offers direction to lenders in the area of rebranding their products for an all-inclusive economic development.