The Role of Informal Credit among Small-scale Farmers for Rural Development in Otupko Local Government Area of Benue State, Nigeria

Abstract

The research examined the role of informal credit on small-scale farmers for rural development in Otukpo local government area of Benue State, Nigeria. Purposive random sampling was adopted in selecting 80 respondents (people who collected loan from informal credit sources). Structured questionnaire was administered to the respondents. Data collected were analysed through descriptive statistics. Results of the findings showed that 62.25% of the respondents obtained information on informal credit from other borrowers, 56.25% used the borrowed money to pay other debts, 45.75% of the respondents married more wives and 56.25% were harassed by lenders when they delayed in paying the money borrowed. It is recommended that the lenders should reduce the harassment on borrowers and there should be uniformity in the charging of interest rate.