This study analyzed the sources and use of agricultural credit among groundnut oil millers in Gombe and Funakaye local government areas of Gombe state. A two stage sampling technique (purposive and random) was adopted to select the respondents. Two districts (Gombe and Funakaye) were purposively selected for their high number of groundnut millers in the state and 120 respondents were randomly selected from the two districts. The data were analyzed using descriptive statistics. The results show that majorities (96.7%) of the oil millers were male, half (50%) of the respondents were within the age bracket of 31- 40years with the mean age of 36 years. The results also revealed that (39%) of the respondents sourced their credit from the Bank of Industry at (8%) interest rate. (36.1%) also sourced their loan from friends/relatives, while (24.9%) funded their businesses from their personal savings. The results revealed that larger majority (92.5%) of the groundnut oil millers used the credit to purchased groundnut while only 7.5% of the respondents purchased both groundnut and milling machine with the loan. Both formal and Informal source of credit play a vital role in the entrepreneurial development among small-scale agro- processors in the study area. Groundnut millers should form association for self-help and access to formal credit. The government should establish formal agricultural credit system in the rural areas with simple procedures of securing loans among groundnut oil millers for them to play their role in economic development of the country.

Keywords : Groundnut, Oil Millers, Credit, Sources and Uses.