Factors affecting farmers' access to formal financial credit in Basona Worana District, North Showa Zone, Amhara Regional State, Ethiopia

Kiros, Shewit; Meshesha, Getamesay Bekele

doi:10.1080/23322039.2022.2035043

Cited by 22 publications

(12 citation statements)

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“…Moreover, our research contributes to the existing body of knowledge by simultaneously investigating factors influencing farmers' access to financial capital and estimating the consequential impact on technical efficiency. This dual perspective addresses a crucial gap in the literature, providing a more comprehensive understanding of the relationship between financial capital and the success of agricultural activities (Houmam & Aomar, 2023;Kiros & Meshesha, 2022;Saqib et al, 2016;Silong & Gadanakis, 2020;Temesgen et al, 2018). By adopting this holistic approach, we aim to shed light on the multifaceted dynamics that underlie the nexus between financial capital access and the technical efficiency of small-scale carrot farmers in Indonesia.…”

Section: Theoretical Frameworkmentioning

confidence: 99%

“…This holistic framework enables a more nuanced understanding of the multifaceted interplay between financial capital and the technical efficiency of small-scale carrot farmers. Moreover, while previous studies have endeavored to identify factors influencing farmers' access to financial capital, our research uniquely bridges this gap by concurrently estimating the consequential impact on technical efficiency, thereby contributing a more comprehensive perspective to the existing body of knowledge (Houmam & Aomar, 2023;Kiros & Meshesha, 2022;Saqib et al, 2016;Silong & Gadanakis, 2020;Temesgen et al, 2018).…”

Section: Introductionmentioning

confidence: 97%

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Examining the Impact of Financial Capital Access on Technical Efficiency: Empirical Insights From Carrot Farmers in Indonesia

AR,

Fahriyah,

Asmara

2024

J. of Law and Sust. Develop.

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Objective: This study investigates the interplay between financial capital access and technical efficiency in small-scale carrot farming in Indonesia, focusing on the regions of Malang and Probolinggo in East Java. Methods: Employing a multistage random sampling method, data was collected from 100 farmers, and stochastic frontier analysis (SFA) was employed to measure technical efficiency. Results: The results highlight the positive and significant impact of financial capital access on farmers' technical efficiency. Farmers with enhanced access to financial resources, including credit and loans, demonstrated higher levels of technical efficiency. Additionally, the study identifies the positive influence of larger cultivated land on technical efficiency, allowing farmers greater flexibility and opportunities for adopting modern agricultural technologies. Conversely, greater distances to cultivation lands were found to negatively impact technical efficiency due to increased transaction costs and difficulties in accessing information and markets. Implication: These findings underscore the critical role of financial capital in shaping the success of small-scale carrot farming, emphasizing its implications for sustainable agricultural practices. The study's insights contribute to the formulation of targeted policies and interventions aimed at improving financial inclusion and reducing geographical barriers to enhance overall agricultural productivity and sustainability in small-scale farming communities.

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Section: Theoretical Frameworkmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 97%

Examining the Impact of Financial Capital Access on Technical Efficiency: Empirical Insights From Carrot Farmers in Indonesia

AR,

Fahriyah,

Asmara

2024

J. of Law and Sust. Develop.

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“…Participation in and access to credit facilities is dependent on a lot of factors which can be purely demographic, economic in nature, cultural or a combination of these (Danso-Abbeam et al, 2016;Anang et al, 2015;Shiferaw et al, 2014;Ngwako et al, 2021). Kiros and Meshesha (2022) stated that variables identified to influence participation in credit schemes and access to credit are the age of the farmer, level of education, gender, and involvement in other nonfarm activities. Nkegbe et al (2022) also revealed that family size, farm output value, availability of credit facilities in the community and the distance between lending agencies and the farmers were the significant drivers for accessing credits.…”

Section: Literature Reviewmentioning

confidence: 99%

Input credit scheme, farm productivity and food security nexus among smallholder rice farmers: evidence from North East Ghana

Wongnaa,

Abudu,

Abdul-Rahaman

et al. 2023

AFR

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PurposeThis study examined the impact of the Input Credit Scheme (ICS) by the Integrated Water Management and Agriculture Development (IWAD) on the productivity and food security of smallholder rice farmers in Ghana.Design/methodology/approachCross-sectional data from 250 rice farming households in the Mamprugu Moagduri district of the North East Region obtained from a multi-stage sampling technique were used for the study. Inverse Probability Weighted Regression Adjustment (IPWRA), Propensity Score Matching (PSM) and Kendall's coefficient of concordance were the methods of analysis employed.FindingsEmpirical results show that education, rice farming experience, dependency ratio, FBO membership, farm size and farm age were the significant factors influencing participation in the input credit scheme (ICS). Also, participants had an average rice productivity of 1,476.83 kg/ha, whereas non-participants had 1,131.81 kg/ha implying that participants increased their productivity by about 30%. In addition, the study revealed that participant households increased their household dietary diversity (HDDS) by 0.45 points amounting to about 8% diversity in their diets. High-interest rates associated with credit received, the short periods of credit repayment and the high cost of inputs provided under the scheme were the most challenging constraints associated with partaking in the ICS.Practical implicationsThe available literature on agricultural interventions have predominantly emphasized input credit as a key factor for improving cropt productivity and food security of smallholders. This study provides compelling evidence that participation in ICSs can result in substantial benefits for agricultural development, as evidenced by increased productivity leading to improved food security. The significance of these findings is highlighted by the fact that, through participation in input credit schemes, smallholder rice farmers in many developing countries see substantial improvement in their capacity to access productive resources, thereby improving their productivity, while simultaneously reducing food insecurity.Social implicationsLeveraging on the improved productivity of participants in the ICS, this study advocates that such input credit schemes should scale up to more food-insecure farming communities in Ghana.Originality/valueThe study uses a doubly robust econometric approach to evaluate the impact of ICS on smallholder rice farmers' productivity and food security in Ghana, making it the first of its kind. The findings offer a solid basis for future research and provide guidance for policymakers looking to boost agricultural development in Ghana.

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“…Farmers' access to and utilization of rural finance services is acknowledged to increase farm productivity, food supply and households' income. This enables the resource-poor small scale farmers to accumulate wealth in order to invest in improved farming technologies that alleviate poverty (Carrer et al, 2020;Das, 2018;Kiros and Meshesha, 2022;Njeru et al, 2016;Silong and Gadanakis, 2020).…”

Section: Introductionmentioning

confidence: 99%

Characterization of Existing Rural Finance Markets that can Enhance Participation in Climate Smart Agricultural Technologies in Kenya

Lydiah

Alice²,

Samuel³

et al. 2023

JPID

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Purpose: In Kenya, small holder farmers face climate change related challenges. It is therefore imperative to enhance adaptive capacity through climate smart agricultural (CSA) technologies. Access to finance is a significant enabler for adoption of CSA technologies yet small holder farmers, especially women, have an acute financing gap for agriculture. The purpose of the study was to characterize existing rural finance markets that can enhance adoption of Climate smart agricultural technologies among small holder farmers in Kenya and also improve the participation of other agricultural value chain actors in climate smart agricultural technologies. This was to enhance a better understanding of existing rural financial services available to agricultural value chain actors and the potential of the financial institutions to increase credit access to the value chain actors. Methodology: The study used cross sectional data gathered through questionnaires administered on farmers, rural financial institutions and other actors in eight, Kenya Climate Agricultural Project (KCSAP) counties in Kenya. Data was analyzed using Stata statistical package and presented using tables and figures. Findings: Rotating and savings credit associations (ROSCAs) were the main credit source for most households. Findings revealed that farmers rarely access insurance for their farming activities. Unlike farmers, other actors for instance, agro processors and agro dealers get loans through mobile phones where short term loans were borrowed from different providers. Majority of financial institutions were serving agricultural sector. Unique Contribution to Theory, Practice and Policy: The study had presumed that access to rural financial market services by value chain actors in climate smart technologies for crops and livestock will be enhanced and this will increase adoption in the target Counties. The theory or assumption was validated in a workshop by all stakeholders which was followed up by linking up the value chain actors and the financial institutions through capacity building forums. Financial institutions could leverage on existing models used by ROSCAs to increase access to rural financial services especially by women and youth. A gender-transformative approach should be considered to increase women access to rural financial services.

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Factors affecting farmers' access to formal financial credit in Basona Worana District, North Showa Zone, Amhara Regional State, Ethiopia

Cited by 22 publications

References 12 publications

Examining the Impact of Financial Capital Access on Technical Efficiency: Empirical Insights From Carrot Farmers in Indonesia

Examining the Impact of Financial Capital Access on Technical Efficiency: Empirical Insights From Carrot Farmers in Indonesia

Input credit scheme, farm productivity and food security nexus among smallholder rice farmers: evidence from North East Ghana

Characterization of Existing Rural Finance Markets that can Enhance Participation in Climate Smart Agricultural Technologies in Kenya

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