Evaluation of Bank Credit Impact on the Agricultural Sector of the Nigerian Economy

The study examined the evaluation of bank credit impact on the agricultural sector of the Nigerian economy. The data was secondary data which was sourced from CBN Statistical Bulletin. The study used multiple regressions of ordinary least square (OLS) analytical techniques. The findings from the regression analysis revealed that that Commercial Bank Credit has positive and significant impact on Agricultural Output/Production, while, Real Interest Rate has positive but non-significant impact on Agricultural Output/Production. The study therefor concludes that the higher the commercial bank credit to agricultural sector will lead to increase in productivity and contribute positively to the growth of the Nigerian economy. While a higher Real interest rate will reduce investment in agricultural ventures which will lead to low economic growth. The study there for recommend the following: that The CBN should as a matter of policy increase commercial bank credit or lending ceiling and such increase should be allocated to the agricultural sector, and that CBN should reduce and regulate the Real interest rate of commercial banks especially when it has to deal with agricultural lending, in order to encourage farmers to invest in agricultural ventures, when they borrow at a lower rate it will increase their productivity which will in turn contribute immensely to the growth of the Nigerian economy.