Abstract

The aim of the study therefore was to access the effect of micro-finance on small scale poultry production with the overview of examining the socio-economic characteristics of the farmers, estimate and compare the cost and return structures between users and non-users of micro-finance, examine the effect of micro-finance on farmers’profit level. Structured and pre-tested questionnaire were used to elicit farm level data from the respondents through multi-stage sampling procedure with eventual sample size of 60 respondents. Descriptive Statistics and the budgetary Model was used to estimate and compare the socio-economic characteristics and the cost and return structure of both users and non-users of micro-finance. While Multiple Regression Model was used to examine effects of micro-finance on production variable and on the output of the farmers. A sample majority 93.33% and 63.33% of users and non-users of micro-finance were married.. Both groups of farmers had equal average household size of 7 persons per household. Budgetary analysis indicated thar users of micro-finance earned an average revenue of ₦924,084.00 as against ₦157,681.00 for non-users of micro-finance whilst in terms of profit the user of micro-finance realized ₦274,610 per production cycle whilst non-users of micro-finance couldn’t break even at the first production cycle making a loss of ₦248,720. Thus, indicating that users of micro-finance had more profit than their counterparts. Finally, the econometric analysis showed that cost of chick (β = -11.61), vaccine cost (β = 14.51), cost of labour (β = -2.23) and volume of loan obtained (β =2.05) were significant variable affecting small scale poultry production and concluded that the business was profitable in the study area.

Keywords: Microfinance, small scale poultry production, budgetary analysis and effects.