Drivers of Access to Credit Among Smallholder Farmers in Uganda: Application of Binary Logistic Model

Abstract

This study aimed at determining the drivers of access to credit among smallholder farmers in Uganda. Using a cross-sectional survey, data were collected from 374 farmers in Jinja district, followed by data analysis using descriptive statistics and Binary logistic regression model. Additionally, we used Chi-square and t-test to compare farmers with and without access to credit. The results showed that 62.83% of the farmers had access to credit. Additionally, farmers with access to credit were generally better off than those without access to credit. Having a mobile phone (p<0.01), group membership (p<0.01), access to extension (p<0.05), farm size (p<0.01) and distance to the market (p<0.05) had a positive and significant effect on credit access while non-farm income (p<0.05) showed an inverse relationship with credit access. To increase credit access among the smallholder farmers, farmers should be encouraged to purchase mobile phones and join groups where they would disseminate information on the various source of agricultural credit. Extension workers should also make effects of reaching all the farmers and training them on ways of accessing agricultural credit.