Iris Publishers - World Journal of Agriculture and Soil Science (WJASS)
Authored by Okpachu SA
Introduction
Agriculture
is an engine of growth and poverty reduction in countries where it is the main
occupation of the poor but the sector is underperforming in many developing
countries, in part because women, who represent a crucial resource in
agriculture and the rural economy through their roles as farmers, laborer’s and
entrepreneurs, almost everywhere face more severe constraints than men in
access to productive resources. Women make essential contributions to the
agricultural and rural economies. Women farmers represent more than a quarter
of the World’s population and comprise about 43 per cent of the agricultural
labor force in developing countries. Food and Agricultural Organization [1]
estimates that if women globally had the same access to productive resources as
men, they could increase the yields on their farms by 20-30 per cent thereby
increasing incomes and decreasing hunger. Studies show that resources
controlled by women are more likely to be used to improve household food
consumption and welfare, reduce child malnutrition, and increase the overall
well-being of the family. In developing countries, Nigeria in particular, Women
play vital roles in food production, processing and marketing; producing about
60- 80 percent of food in the country [2,3] and contributing about 60-80
percent of agricultural labor force [2]. Egwu and Nwibo [4] reported that rural
woman spends most of their income immediately on household needs and often have
to make up deficiencies of what their husbands provided for them. Women also
use their income to meet a variety of household and personal expenses and thus
will be left with little or nothing to save. Even though millions of women
throughout the world contribute to national agricultural output and family food
security, detailed studies from developing countries consistently indicate that
rural women are more likely to be financially constrained than men of
equivalent socioeconomic status.
In
recent years, there has been a paradigm shift from microcredit provision to
microfinance with savings as the means for capital accumulation. Given the
scarcity of economic resources and insatiability of human wants, there can
never be a better future or development of any kind without capital
accumulation in the present. Savings therefore becomes a necessary factor for
development and investment at rural and national levels. Saving is a means of
accumulating assets that perform specific function for the saver [5]. Capital
on the other hand is the large amount of money that is used to set up a
business (capital funds) while accumulation is the process of building up
capital stock through positive net investment. Capital accumulation is low in
developing countries such as Nigeria due to low levels of income and low saving
level. With low investment output becomes low which leads to low income and as
well translates to low savings. This situation perpetuates the vicious cycle of
poverty. According to Osondu, Obike and Ogbonna [6], capital accumulation is
very difficult because with low incomes, very little savings or investment
occur out of existing income.
Savings
of rural women is one of the factors that could help them overcome the effect
of constraints in production and achieve their potentials. Their savings have a
multiplier effect to the economy. It contributes to the accumulation of
financial capital at household as well as national levels. It also helps to
reduce vulnerabilities in times of shocks.
Even
though millions of women throughout the world contribute to national
agricultural output and family food security, detailed studies from developing
countries consistently indicate that rural women are more likely to be
financially constrained than men of equivalent socioeconomic status [7].
Previous research findings on savings have dwelled more on household savings
with the male heads of households as the respondents. While women are also
active and constitute half of the working labor force in rural areas, they also
take part in savings mobilization, but are not usually taken into consideration.
Considering
the important contribution of women in the economy, it is imperative to
understand their savings mobilization from the perspective of rural women.
Therefore, this study intends to investigate the strategies employed by the
rural female farmers in Potiskum Local Government Area to mobilize savings and
accumulate capital. Also, the various financial institutions patronized by the
farmers and the extent of their patronage as well as various problems and
constraints facing rural female farmers in their savings and capital
accumulation efforts were addressed. In the same vein, the effect of
socioeconomic characteristics of these rural farmers on their level of savings
and capital accumulation were also determined.
Methodology
Study
area
The
study was conducted in Ganye Local Government Area of Adamawa State, Nigeria.
The local government is noted to be one of the major foods producing areas in
Adamawa State. Ganye LGA is a local government area in Adamawa state located in
the town of Ganye, as the area council consists of the following districts of
Gurum, Yebbi, Timfore, Jaggu, Ganye, Bakarigusso and Sugu. According to the
2006 population census, the local government area has a population of 169, 948
people made up of 85,798 males and 72,335 females [8].
Sampling
procedure
A
multi-stage random sampling procedure was employed in the selection of
respondents for the study. Ten communities were randomly selected from the
twenty communities. 15 farming households were randomly sampled from each of
the selected communities. This gave a total of 150 farming households that were
sampled and administered with questionnaire for the study. However, out of the
150-questionnaire administered, 100 of the questionnaires were returned and
analyzed for the study
Data
collection
The
data for the study were obtained from primary sources through the use of
structured questionnaire that were administered to the sampled rural female
farmers. The questionnaire was drawn to elicit information on the socioeconomic
characteristics of the farmers, form and technique of savings and capital
accumulation, various formal and informal savings institutions patronized and
the rates, problems militating against their savings and capital accumulation
efforts among others.
Data analysis
Data
generated for the study were analyzed with the use of Descriptive statistics
such as percentages, frequency distribution and means as well as multiple
regression analysis. Following Ike and Umuedafe [9], the multiple regression
expressed the effect of socioeconomic variables on the level of savings and
capital accumulated. The regression model was implicitly specified as:
Y = β0
+ β1X1 + β2X2 + β3X3 + β4X4 + β5X5+ β6X6 + β7X7 + β8X8 + μ
Where,
Y =
volume of savings/capital accumulated
β0 =
Constant
β0 –
β8 = Coefficients
X1 =
Family size of respondents.
X2 =
Level of education (Years)
X3 =
Farming experience (Years) β
X4 =
Farm cash income (Naira)
X5 =
Non-Farm cash Income (Naira)
X6 = Total
farm output (Naira)
X7 =
Distance of nearest saving institution (km)
X8 =
Distance of nearest local market (km)
μ =
Error term
The
lead equation was chosen on the basis of conformity with a priori expectations
of parameters, statistical as well as econometric criteria such as the
magnitude of R2 and the t-values of the estimates and the number of significant
variables in each estimated equation.
Results
and Discussions
Socio-
economic characteristics of respondents
The
result of the socioeconomic characteristics of respondents is summarized in
Table 1. The average age of the rural female farmers is 37 years which indicate
that the farmers are young, active, energetic and in their productive age.
Also, young people are believed to save more. The mean family size is 11
indicating that large family size which is typical of a developing country like
Nigeria. Large family saves less since the needs of other members of the
household have to be met. Table 1 also revealed majority of the respondents
(67%) had Quaranic education, while 33% of the respondents were literate with
diverse formal educational level ranging from primary school education to
tertiary education. Possession of formal education will enable the farmers
adopt agricultural innovations and this can impact on their level of income
that could be generated from their farm activities through improved
agricultural innovations, hence improving the capability of the farmers to
save. The distribution of respondents according to farm size is shown in Table
1. The table showed that majority of the farmers (64%) had farm sizes of less
than one hectare, while 29% of them had farm sizes of between 1 to 2 hectares.
The mean farm size of the respondents is 0.74 hectares, indicating the small
holdings of the rural women farmers result in low output, low income and lower
propensity to save. In view of this, 51% of the farmers earn an income of
between N20, 000-N40, 000 which on the average amounted to N45, 000 per annum.
This finding signified a low-income generation level of the households in the
area which will not support savings.
Furthermore, it was noted that the rural women farmers covered a mean distance of 13km to reach to the nearest market to sell their farm produce. A critical analysis on the distance showed that the women in African context spent relatively small distance to get to the market. Hence, the close distance will have positive impact in reduction of transportation cost which invariably encourages saving.
The nearness of financial institutions
not only encourages saving and deposits, but reduces the cost and risks
associated with cash movement. According to Obalola, Audu and Danilola [10],
distance to banks predicts saving behaviour of rural consumers. Based on the
foregoing, the study showed that the women farmers of Yobe State, Nigeria
covered a distance of 13km and above to reach to the nearest financial
institution. This showed a relatively large distance as most of the rural women
lack mobility means to reach to the financial institutions which are mainly
located in the urban areas. This in fact, does not encourage saving as most of
them do lack information on saving, and face risks of theft during cash
movement.
Among the eight parameters included in the model, five
were significant. The table shows that the coefficient for family size, farm
cash income, non-farm cash income, total farm output and distance to nearest
local market were all significant at 1% level, while the coefficient of
household size was significant at 5%. However, the coefficient educational
level, farming experience and nearness to saving institutions were not
significant. This implies that the rural female farmer’s volume of saving or
accumulated capital is based on their family size, farm cash income, non-farm
cash income, total farm output and distance to nearest local market.
Household size had a significant negative coefficient on
the volume of savings of small-scale farmers. This implies that a farmer with
small household will likely save more of his income. Thus, this is in line with
a prior expectation, as increase in household size, reduces the capacity of
farmers to save. This contradicts the findings of Osondu, Obike and Ogbonna
Osondu [6] that farmers with large household sizes save more of their income.
The coefficient of farm cash income was positively signed and statistically
significant at 1%. This conformed to the a priori expectation. Thus, an
increase in the farm cash income of rural women farmers
will lead to a significant increase in their saving
capacity. This is expected since farm produce serves as a major source of farm
income to rural households. The finding corroborated Nuhu, Bzugu and Kwajaffa
[7] who posited that income viability of farm families had positive influence
on their saving potentials. Non-farm income is statistically significant in the
model. This implies that the earning from non-farm activities is most likely to
influence their volume of saving or capital accumulation of the rural farmers.
If they are intensively involved in these non-farm activities like petty
trading, hair dressing, sewing etc. they are likely to save or accumulate more
capital than those who are not involved. Again, the coefficient of farm output
(x6) was positive and significant at 1% level. This showed that increase in
farm output of rural women farmer will lead to a significant increase in their
saving capacity. This conformed to the a priori expectation since increased
yield may translate to increased income to farmers, hence impacting positively
on the saving capacity. The coefficient of distance of the nearest market was
positively signed as expected and statistically significant at 1%. Thus, the
nearer a market is to the rural women famers, the higher will be their capacity
to saved. This agrees with the a priori expectation since closeness of the
market enables the farmers to sell off both their final and intermediates
product with minimal wastage or loss. Equally, nearness of the market reduces
the cost of transporting goods thereby increasing the revenue accruing to the
farmers. Therefore, the above analysis shows that the rural women’s saving
capacity is greatly influenced by any means that encourages the increase in
their income generation.
Conclusion and Recommendations
This study investigated savings and capital
accumulations strategies among rural farmers in Potiskum Local Government Area
of Yobe State. Family size, Farm cash income, non-farm cash income, total farm
output and nearness to local markets were found to significantly affect the
volume of savings and capital accumulation in the study area. It shows that
these socioeconomic variables have impact in the volume of savings and capital
accumulation of the rural female farmers. To further improve on savings and
capital accumulation of rural female farmers and in view of their deficiency in
the study area, it is suggested that:
The government should make credit or loan available to
rural female farmers by empowering formal and informal financial institutions
to meet the credit needs of rural dwellers.
The government should create enabling socio-economic
environment that will increase the rural women farm income through market
creation for farm output and subsidy in the price of farm input. Again, the
rural financial intermediaries should encourage farmers to save by raising the
interest paid on saving; this will discourage farmers from saving in kind or
hoarding cash in the house which usually lead to loss of wealth in case of
thefts,
Creation of market
corridors to be close to production areas to reduce distance to local market.
The informal savings institution like the Asusu club, co-operative societies
among others should be brought into the national credit system. In order to
achieve this, they should be allowed to register with the state ministry of
commerce and industry
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