Abstract

Nigeria is endowed with huge expanse of fertile agricultural land, rivers, streams, lakes, forest and grassland, as well as a large active population that can sustain a high productive and profitable agricultural sector; yet the country is an import dependent nation even of the commodities she would have ordinarily produced, given her natural endowment. The study then investigates the impact of Deposit Money Banks on the Agricultural sector with this question in mind: “does it mean that deposit money banks are not advancing adequate credit that will boost the productivity of the agricultural sector?”We developed two models, in line with economic theory. The first model investigates the impact of Commercial Bank credit and Government expenditure on agriculture on the level of Agricultural productivity in Nigeria. The second model looks at the contribution of agricultural productivity on the Gross Domestic Product with interest rate as a control variable. The study found that deposit money banks’ credit and interest rate does not have impact on agricultural productivity in Nigeria. Other findings of the study are agricultural output has significant impact on economic growth Nigeria; and Government spending on agriculture in Nigeria has impact on agricultural productivity. The study recommends that government should map out long-tenured fund for agricultural purpose in commercial banks and disbursement of such fund adequately monitored.