| dc.description.abstract | This study seeks to examine the effect of access to finance to farmers on farm level performance in Uganda. Agriculture is the major source of livelihood in Uganda as it employs 65 percent of the working population (UBOS 2018) but receives only 17.3 percent of private sector credit (MFPED, 2017). This is the problem that backs this research paper.
The study was focused on mainly crop and livestock farmers in all regions and sub-regions of Uganda, carried out from 1st July, 2018 through 31st May, 2019. The research design adopted was cross-sectional whereby farmers from ten agro-economical zonal areas and fourteen statistical sub-regions were interviewed.
Using Computer Aided Personal Interview (CAPI), the post planting and the post harvesting questionnaires, were used by the field staff to obtain the information required. The primary data was first cleaned then final tables ran, all using the STATA package. The researcher in this particular study then merged two datasets of interest into one and carried out analysis in the same application. Our targeted variables were; source of loan, purpose for acquiring loan, loan period, loan amount, sex, marital status and age of respondents.
For the univariate analysis, 51.0 percent of the respondents were female and 48.97 percent male. Of the total respondents, 57.3 percent were never married, while the rest were married. Finance that was accessed was more likely for less than year (94.38 percent) for an average loan amount of 268193 UGX and mean age of respondents being 27 years. The researcher also noted that farmers acquired finance for various reasons, majority for purchasing seeds for planting while the fewest for setting up an irrigation structure.
Under bivariate analysis, the independent variables loan period and loan amount had a statistically significant effect on the access to finance by farmers in Uganda while sex, age and marital status were not statistically significant.
At multivariate level analysis, access to finance was explained by loan period and loan amount (both with P = 0.000). Therefore, in order to process agricultural loans in Uganda, these are two of the variables put into consideration. However, these two predictors only affect access to finance by 8.61 percent thus there are more predictors put into consideration during loan processing.
The researcher recommends that infrastructure that supports financial transactions is strengthened, such that they are in better position to lend finance to various groups of farmers and informal groups formalized to achieve wider coverage of access to formal finance. Also, that farmers be sensitized about the benefits accrued when using formal financial institutions. | en_US |
