IMPACT OF AGRICULTURAL CREDIT GUARANTEE SCHEME FUND ON AGRICULTURAL OUTPUT IN NIGERIA

This study examines the impact of the Agricultural Credit Guarantee Scheme Fund (ACGSF) on agricultural output in Nigeria, focusing on the period from 1980 to 2023. Agriculture remains a cornerstone of Nigeria’s economy, contributing significantly to employment, food security, and GDP. However, access to adequate credit has historically been a major constraint to agricultural productivity. The ACGSF, established to improve farmers’ access to credit by guaranteeing loans provided by financial institutions, is a critical government intervention aimed at addressing this challenge. This study investigates the extent to which the ACGSF has influenced agricultural output, employing time-series data and econometric methods, including Ordinary Least Squares (OLS) regression and Granger causality analysis. The findings reveal a significant and positive relationship between ACGSF disbursements and agricultural output, indicating that increased credit guarantees have effectively stimulated agricultural productivity. However, the study also identifies persistent challenges, including delayed disbursement of funds, high interest rates, and inadequate monitoring of loan utilization, which have limited the scheme’s overall impact. These results highlight the importance of improving the efficiency and accessibility of the credit guarantee scheme to maximize its benefits. The study contributes to the growing body of knowledge on agricultural finance and provides policymakers with actionable insights to enhance agricultural productivity and promote sustainable economic development in Nigeria.