EFFECTS OF AGRICULTURAL FINANCING ON POVERTY LEVEL IN NIGERIA

Agriculture remains central to Nigeria’s economy, employing a large portion of the population and contributing significantly to food security. However, persistent poverty, especially in rural areas, is linked to inadequate financing of the agricultural sector. Many smallholder farmers lack access to credit, subsidies, and financial services needed to improve productivity. This study therefore examines the effects of agricultural financing on poverty levels in Nigeria, with the objective of determining whether increased access to credit and investment in agriculture can reduce poverty and improve livelihoods. The study employed a descriptive research design, drawing on both primary and secondary data. Primary data were collected through structured questionnaires administered to farmers, while secondary data were sourced from government publications, the Central Bank of Nigeria reports, and World Bank statistics. Econometric analysis, including regression and correlation techniques, was used to examine the relationship between agricultural financing and poverty indicators such as income, employment, and food availability. Findings revealed that agricultural financing has a significant and positive impact on poverty reduction in Nigeria. Farmers with access to loans, grants, or subsidies recorded higher levels of productivity, income growth, and better living standards compared to those without access. However, challenges such as high interest rates, limited financial literacy, and bureaucratic bottlenecks were identified as obstacles limiting the effectiveness of financing initiatives. The study concludes that strengthening agricultural financing is vital for sustainable poverty alleviation in Nigeria. It recommends expanding credit facilities tailored to farmers, reducing lending barriers, improving extension services, and ensuring transparent monitoring of financing programs to maximize their impact on poverty reduction.