The study of determinants of loan default and repayment rates by cassava farmer loan beneficiaries (CFLB) in Bank of Agriculture (BOA) and First Bank of Nigeria (FBN) was conducted between 2012 and 2014 in the South-south Nigeria. Multi-stage, purposive and random sampling techniques were used to select two hundred and fifty (250) cassava farmers who had benefitted from either BOA or FBN loans in the past five (5) years (2009-2013). Time-series data was gathered using two sets of well-structured questionnaires from the CFLB and the banks officials. The results of data analysed showed that BOA granted the highest loan of N1,671,497,140.00 compared to FBN which granted only N891,500,000.00 to the cassava farmers during the period (2009-2013).The lending criteria adopted by the two banks were similar except the difference in their interest rates- (BOA charged 12%, FBN charged 21%). Further analysis showed that BOA had a better repayment rate than FBN. Major constraints to loan administration in the study area were non-repayment of loan by beneficiaries, delay in repayment of loans and diversion of agricultural loans to non-agricultural sector among others. It was concluded that high default rate limited agricultural loan administration in the study area. It was recommended that less burdensome administrative procedures in acquiring loan should be ensured as well as adequate monitoring and evaluation of potential beneficiaries so as to minimize default rate.
Keywords: Cassava Farmer Loan Beneficiaries Bank of Agriculture, First Bank, Loan Default Rate, Nigeria, Repayment Rate, South-South
