Financial intermediation by microfinancec institutions and Nigeria agricultural productivity: A cointegration analysis

Nigeria’s agricultural sector faces persistent financing gaps despite the proliferation of microfinance banks (MFBs). While MFBs are designed to channel credit to underserved sectors, their actual impact on agricultural performance remains empirically underexplored. This study examines the impact of microfinance intermediation services on Nigeria’s agricultural sector performance over three decades. Using time-series data (۱۹۹۰–۲۰۲۰) from the Central Bank of Nigeria and World Development Indicators, The study employed ARDL bounds testing to analyze the long-run relationships between MFB loans, deposits, interest rates, exchange rates, and agricultural GDP contribution. Microfinance deposits and exchange rates significantly enhance agricultural performance, while loan disbursements and interest rates have no significant effect. The model explains ۸۹% of variance with robust diagnostic properties. Error correction mechanisms confirm stable long-run equilibrium. Deposit mobilization, rather than direct lending, emerges as the critical channel through which MFBs influence agricultural outcomes. Policymakers should prioritize strengthening deposit-taking capacity of microfinance institutions.

کلیدواژه ها:

Microfinance banks ، financial intermediation ، Agricultural sector performance ، Deposit mobilization ، Nigeria