Deposit Money Bank’s Credit and Agricultural Sector’s Output in Nigeria: Empirical Analysis

The study examined the impact of deposit money bank’s credit on agricultural output in Nigeria and data used were sourced from the Central Bank of Nigeria (CBN) Statistical bulletin and World Bank Development Index for the period of 43 years covering 1981 to 2023. The Autoregressive Distributed Lag (ARDL) regression technique was employed in the estimation of the data to investigate the long run and the short run relationship between the variables. The findings revealed that deposit money banks credit to agriculture has direct and insignificant relationship with agricultural productivity in Nigeria both in the long run and the short run. The result also shown that a one- percent increase in government expenditure on agriculture and lending rate will raises agricultural output in Nigeria by 0.52% and 0.26% in the long run but in the short run it will raises agricultural output in Nigeria by 2.96% and 0.46% respectively. Based on the results, it was recommended that the Central bank of Nigeria (CBN) should encourage the deposit money banks (DMBs) to open more branches in all parts of the states particularly in the rural areas in order to encourage rural dwellers to have access to banks and save more of their funds for agricultural development.