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The purpose of this paper is to determine the level of flexibility in loan products offered to smallholder farmers in Siaya County in Kenya and to examine the effect of flexibility on access to credit.

The paper uses primary survey data from a sample of smallholder farmers in Siaya County in Kenya who had borrowed from various lending institutions within the study area. The paper develops an index variable of loan flexibility using multiple correspondence analysis (MCA) technique. The model is estimated using both OLS and truncated regression analyses. Access to credit is measured as the amount of loan borrowed by each farmer.

The authors find that the level of flexibility of loans offered to farmers is low. Furthermore, the authors find that the level of flexibility is not significantly correlated to access to credit. Further analysis using individual components of flexible loans show that refinancing and lines of credit are more likely to improve access to credit when farmers are more educated and wealthier, respectively. The age of a farmer, the type of lender, the type of loan, education and household wealth are the main determinants of access to credit.

The paper adds to the debate on access to credit by showing that theoretically, while loan flexibility should lead to higher credit access, this is not a key determinant of access to credit in this context.

The aim of this paper is to analyze the effects of access to credit on maize productivity in Mali, by identifying the determinants of credit market participation and maize yield, and then estimating the impact of credit on maize yield.

This study analyzes the impact of credit on maize productivity using data from the World Bank 2014 Living Standards Measurement Survey (LSMS) on Mali, and the endogenous switching regression (ESR) model.

The results suggest a positive effect of credit on maize yield in Mali. Farm size, production shocks and the female gender exert negative effects on credit market participation, unlike education, intercropping with cotton, male family labor and fertilizer use which show positive effects. Farm size has a negative effect on maize yield, but both male family labor, and fertilizer use exert positive effects. Although the use of credit improves agricultural yields, the results show a greater potential effect for rationed producers, than credit users.

These results suggest that implementing a credit strategy that allows those currently excluded from the credit market, to participate, could substantially increase productivity and maize production output in furtherance of the country's food security strategy. Gender-based targeting is needed to bridge the gender gap in access to credit.

As far as the authors are aware, this study is the first to explore the credit-farm productivity links in Mali, while addressing selection bias.

The purpose of this paper is to offer an empirical analysis of contract farming (CF) for poultry in the southern state of Andhra Pradesh in India.

Through a probit equation, the factors that matter to their participation in contracting are evaluated. The estimation of income gains is considered within a treatment effects model. The risk benefits from contracting are estimated by simulating the variability of returns if the contract farmers were to be independent growers.

This paper shows that the poultry integrators in Andhra Pradesh are able to appropriate almost the entire efficiency gains from contracting. Yet, the contract growers are better off with the contract. This outcome is because of grower heterogeneity and the way it is employed in the selection of contract growers. The paper also finds that contract growers do gain substantially in terms of risk reduction.

The CF literature reminds us that these arrangements often fail because of opportunistic behavior. The poultry example shows that contracting is a useful institution when processor interests are closely aligned to that of the grower. This paper describes the circumstances under which this alignment is obtained.

First, it adds to the small and growing body of work that estimates the income gains to contract growers. Second and going beyond existing work on developing countries, this paper also addresses the risk benefits from contracting. Thirdly, this paper estimates the income gains from contracting to the processing firms.

Promoted for its inclusivity, agricultural value chain (AVC) financing leverages social capital and mechanisms such as off-take agreements and forward contracts to reduce borrowing and lending costs and risks for both farmers and lending institutions. AVC financing has been defined as the flow of financial products and services to and among the various actors within the AVC to address constraints of production and distribution and fulfill the needs of those involved in the chain by reducing risk and improving efficiency. This paper investigates how farmers' involvement in AVC affects their access to credit.

The authors collected primary data from 400 crop farmers in northern Ghana through a semi-structured questionnaire and analyzed the data, using the multinomial endogenous switching regression model.

Joint participation in AVC increased the amount of formal and informal credit received by 64 and 78%, respectively, compared to nonparticipation. Similarly, participation in AVC horizontal linkage and AVC vertical linkage increased the amount of formal and informal credit received by 40 and 47% and 46 and 74%, respectively, compared to nonparticipation. Irrigation farming, extension visits, knowledge of AVC in the community, access to a storage facility and trust in contract farming significantly influenced farmers' participation in AVC.

The authors’ work offers valuable insights into how different dimensions of value chain participation can impact smallholder farmers' access to credit. This work also underscores the importance of considering both formal and informal credit sources when analyzing the outcomes of value chain participation. The findings could enable formal financial providers to identify, liaise and/or resource informal financial players such as value chain actors to supply both formal and informal credit to farmers in AVCs.

In the developing countries, formal credit has dominant role for the development of agriculture sector. It increases the farmer's purchasing power for better farm inputs and agricultural technology for high crop productivity. The main purpose of this study is to examine the influence of socioeconomic characteristics of smallholder farmers for credit demand in Sindh, Pakistan.

A cross-sectional data set randomly collected from 90 smallholder farmers in Thatta district, Sindh, Pakistan, is examined. Descriptive statistics, correlation and the OLS regression method were used to demonstrate the important factors affecting the demand for formal credit.

The results revealed that formal education, experience of farming, landholding size, road access and extension contacts positively and significantly influenced the demand for formal credit.

This study is the first, to the best of authors' knowledge, to demonstrate the influence of various socioeconomic characteristics of smallholder farmers on demand for formal credit in Sindh, Pakistan. It also illustrates the imperative contribution to the literature regarding credit access and demand to improve the agricultural productivity.

Access to finance is an important condition for the development of agriculture and the farms’ performance. The purpose of this paper is to analyse the association between the technical efficiency of horticultural farms and access to finance from different finance providers.

Data were collected from 434 farmers who produce mango, mangosteen, chili and red onion in Indonesia. Data were subsequently analysed using data envelopment analysis and bootstrap truncated regression.

The results show that commercial credit from banks and in-kind finance provided through farmers’ associations have a positive association with the technical efficiency of some types of horticultural farms. Commercial credit from micro finance institution and flexible payment of inputs to the agricultural input kiosk generally have negative associations, especially with the technical efficiency of mangosteen farms. Subsidised credit from banks and in-kind finance from traders have both positive and negative associations with the technical efficiency of the horticultural farms.

This study adds to the existing literature by analysing access to finance from a broader range of finance providers and its relation to technical efficiency.

This document analyses farmers' preferences and willingness to pay (CAP) for microcredit, in order to facilitate their access in rural areas.

Data are based on a discrete choice experiment with 400 randomly selected farmers from 20 villages of the 7 Benin agricultural development hubs (ADHs). The preference choice modelling was performed using mixed logit (MXL) and latent class logit (LCL) models. Farmers' willingness to pay for each preferred attribute was estimated. The endogenous attribute attendance (EAA) model was also used to capture attribute non-attendance (ANA) phenomenon.

The results indicate that, on average, farmers prefer individual loans, low interest rates, in kind + cash loans, cash loans, disbursement before planting and loans with at least 10-month duration. These preferences vary according to farmers' classes. Farmers are willing to pay higher or lower interest rates depending on attribute importance. The estimate of the EAA model indicates that, when taking the ANA phenomenon into consideration, people will show stronger attitudes regarding WTP for important factors.

Based on these results from Benin, microfinance institutions (MFIs) in developing countries can, based on the interest rates currently charged, attract more farmers as customers, reviewing the combination of the levels of the attributes associated with the nature of the loan, the type of loan (individual or collective), the disbursement period of funds, the waiting period of the loan and the loan duration. However, the study only considered production credit, ignoring equipment or investment credit.

The document provides information on the key factors that can facilitate producers' access to MFI products and services.

Facilitating small farmers' access to financial service will contribute to poverty reduction.

This research contributes to the knowledge of the attributes and attribute levels favoured by farmers when choosing financial products and the amounts they agree to pay for these attributes. The implementation of the results would facilitate small producers' access to financial services; thus contributing to poverty reduction.

The purpose of this paper is twofold: to determine the factors contributing to farm income in the Transitional and Savanna zones of Ghana and to ascertain variations between in the same and across the two locations; and to determine the impact of credit on farm income in each of the two zones and to ascertain the variation in impact of credit across the two locations.

In order to address endogeneity and sample selection bias, the authors draw from the theory of impact evaluation in nonrandom experiment, employing the endogenous switching regression (ESR) while using the propensity score matching (PSM) to check for robustness of the results.

The results show significant mean differences between some characteristics of households that have access to credit and those that did not have access. Further, the results revealed farm size, labor; gender, age, literacy, wealth and group membership as the significant determinants of both credit access and income in the two zones. With the ESR, credit access increases households farm income by GH¢206.56/ha and GH¢39.74/ha in the Transitional and Savanna zones, respectively, but with the PSM, credit increases farm income by GH¢201.50 and GH¢45.69 and in the Transitional and Savanna, respectively.

The mean differences in characteristics of the households revealed the presence of selection bias in the distribution of household’s covariates in the two zones. The results further indicate the importance of productive resources, information and household characteristics in improved access to credit and farm income. Also, the results from both methods indicate that credit access leads to significant gains in farm income for households in both zones. However, differences exist in the results of PSM and that of the ESR results.

The presence of selection bias in the samples suggests that the use of ESR and PSM techniques is appropriate. Further, the results suggesting that enhanced credit access and farm income could be attained through improved access to household resources and information. The results also suggest the need for establishing and expanding credit programs to cover more households in both zones. The differential impact of credit between the two methods employed in each zone revealed the weakness of each model. The low values from PSM could indicate the presence of selection bias resulting from unobservable factors whiles the high values from the ESR could stem from the restrictive assumption of the model. This reinforces the importance of combining mixed methods to check robustness of results and to explore the weakness of each method employed.

The novelty of this study lies in the use of a very extensive and unique data set to decompose the determinants of credit access and farm income and as well as the impacts of credit into zones.

The purpose of this paper is to examine the relationship between credit access and technical efficiency of smallholder crop farmers in northern Ghana.

The study uses a random sample of 445 farming households in the three northern regions of Ghana. The two-stage double bootstrap DEA approach was used to consistently estimate technical efficiency scores as well as the determinants.

The results revealed that, given the current technology, there is substantial yield or productivity gap among the sample of producers in northern Ghana used for the study. This is because producers can reduce input use by over 50.0 percent while still achieving the same output levels. It is further revealed that proportion of household income from off-farm activities, distance of farm from homestead, location and credit access are significant determinants of technical efficiency.

The current study differs from previous studies in two basic ways. First, it takes into account the fact that smallholder farmers practise mixed or inter-cropping by using value of output so that various crops on a given plot of the farmer can be aggregated; and second, a nonparametric approach is adopted so that the inherent inconsistencies in using the two-step model within a parametric framework can be avoided.

The purpose of this paper is to examine the effect of the Ministry of Food and Agriculture (MoFA) Block Farm Credit Programme (BFCP) participation on crop output in four districts in the Northern region of Ghana.

Structured questionnaires were used to collect data from 240 beneficiary and non-beneficiary farmers of BFCP. The treatment effect model that accounts for selectivity bias was employed to examine the socioeconomic determinants of farmers’ decision to participate in the BFCP and the effect of BFCP participation on crop output.

Even though the BFCP participation increases output, inadequacy and late delivery of BFCP inputs, low publicity about the programme and difficulty in accessing the inputs from the districts agricultural officers are factors that prevent the full realization of the benefits of the programme. Improving extension services to create more awareness and a re-introduction of the BFCP to make inputs available and affordable to farmers can help boost farm productivity.

The positive effect of the BFCP means that the provision of low-cost production credit has the potential to increase productivity and improve incomes. Hence, MoFA should endeavour up scaling and properly managing the scheme.

This study is the first to evaluate the BFCP in Northern region of Ghana, particularly in relation to its contribution to crop value. The findings are very useful to advise policy by taking account of the programme deficiencies and enhance effectiveness.