Effects of financial inclusion on cassava productivity of smallholder cassava farmers in Rivers State, Nigeria

Abstract

This study assessed the effects of financial inclusion on cassava productivity of smallholder cassava farmers in Rivers State. Specifically, the study identified the financial inclusion products/services available in the study area, identified the providers of these products/services, and determined the effects of these products/services on cassava productivity. A multi-stage sampling procedure was used to sample 357 respondents; data were collected through structured questionnaires and analyzed using both descriptive and inferential statistics. The results showed that 68.1% of the farmers used only accounts and payment services offered by commercial banks and banking agents/POS operators that constituted 99.4% of the financial services providers in the study area. The financial inclusion variables considered in the study explained 23.9% of the variation in cassava output (R²= 0.239). Credit (coefficient=0.323) and insurance (0.617) had positive and significant effects on productivity, while bank accounts (-0.140), investment (-0.138), and payment services (0.041) were not significant. The study concluded that financial inclusion has positive but limited effects on cassava output and that not all the financial inclusion services/products and providers were commonly available. Recommendations include educating farmers on impactful services, expanding product offerings by financial institutions, and providing incentives for establishing diverse financial service providers in rural areas.