Journal of Development and Agricultural Economics
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Article Number - 7B829F065199


Vol.9(8), pp. 210-216 , August 2017
DOI: 10.5897/JDAE2017.0814
ISSN: 2006-9774



Full Length Research Paper

Determinants of credit access by smallholder farmers in North-East Benin



Perceval N. Assogba
  • Perceval N. Assogba
  • Department of Agricultural Economics and Rural Sociology, Faculty of Agronomy, University of Parakou, Benin Republic.
  • Google Scholar
Senakpon E. Haroll Kokoye
  • Senakpon E. Haroll Kokoye
  • Department of Agricultural Economics and Rural Sociology, College of Agriculture, Auburn University, USA.
  • Google Scholar
Rosaine N. Yegbemey
  • Rosaine N. Yegbemey
  • Department of Agricultural Economics and Rural Sociology, Faculty of Agronomy, University of Parakou, Benin Republic.
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Jonas A. Djenontin
  • Jonas A. Djenontin
  • Department of Natural Resources Management, Faculty of Agronomy, University of Parakou, Benin Republic.
  • Google Scholar
Zacharie Tassou
  • Zacharie Tassou
  • Department of Agricultural Economics and Rural Sociology, Faculty of Agronomy, University of Parakou, Benin Republic.
  • Google Scholar
Joanna Pardoe
  • Joanna Pardoe
  • Institute for Environment and Human Security, United Nations University, Germany.
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Jacob A. Yabi
  • Jacob A. Yabi
  • Department of Agricultural Economics and Rural Sociology, Faculty of Agronomy, University of Parakou, Benin Republic.
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 Received: 03 February 2017  Accepted: 26 May 2017  Published: 31 August 2017

Copyright © 2017 Author(s) retain the copyright of this article.
This article is published under the terms of the Creative Commons Attribution License 4.0


Financing agriculture is a key issue in rural development. Despite the efforts of the government to make credit services available and affordable in most of the rural areas, access to credit among smallholder farmers remains low. This paper analyzes the determinants of credit access by farmers in the North East, Benin. Primary data were collected from one hundred and twenty respondents randomly selected and interviewed through structured questionnaire. A Logit model was specified to identify the relationships between access to credit and selected farmers’ socio-economic characteristics. Following this, the marginal effects of the selected farmers’ socio-economic characteristics on the probability to access credit were estimated. The analysis revealed that access to credit among smallholder farmers is determined by the number of years of schooling, literacy, membership, guarantor, collateral and interest rate. For each additional year of schooling, the likelihood of access to credit was found to increase by 3.9% while literacy in the local language was found to increase the likelihood by 10.9%. Membership of farmers’ cooperatives was found to increase the likelihood of access to credit by 31% while having a guarantor increases this likelihood by 18.9%. However, the availability of collateral decreases the likelihood of credit access by 12.4% while credit with high interest rates decreases it by 11.7%. Thus, to improve rural farmers’ access to credit, governments and non-governmental organizations should promote education, literacy and cooperative membership among farmers. Moreover, financial institutions should also play a key role by keeping interest rates for loans at a low level.

 

Key words: Smallholder farmers, credit, determinants, logit, Benin.

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APA Assogba, P. N., Kokoye, S. E. H., Yegbemey, R. N., Djenontin, J. A., Tassou, Z., Pardoe, J., & Yabi, J. A. (2017). Determinants of credit access by smallholder farmers in North-East Benin. Journal of Development and Agricultural Economics, 9(8), 210-216.
Chicago Perceval N. Assogba,, Senakpon E. Haroll Kokoye, Rosaine N. Yegbemey, Jonas A. Djenontin, Zacharie Tassou, Joanna Pardoe and Jacob A. Yabi. "Determinants of credit access by smallholder farmers in North-East Benin." Journal of Development and Agricultural Economics 9, no. 8 (2017): 210-216.
MLA Perceval N. Assogba, et al. "Determinants of credit access by smallholder farmers in North-East Benin." Journal of Development and Agricultural Economics 9.8 (2017): 210-216.
   
DOI 10.5897/JDAE2017.0814
URL http://academicjournals.org/journal/JDAE/article-abstract/7B829F065199

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