Determinants of Smallholder Dairy Farmers Access to Credit: A Case of Uasin Gishu County
In Uasin Gishu County, smallholder dairy farming is of great importance as it provides a means of livelihood. Among other constraints, lack of finance is one of the fundamental problems plaguing dairy productivity and denying stabilising household income amongst the smallholder farmers. A substantial increase in provision of financial services by financial institutions to the smallholder dairy producers has been recorded in the recent past. However, there is limited information on their effective facilitation on access to credit and ultimate impact on performance in dairy production in Uasin Gishu County. The main objective of this study was to ascertain socio-economic factors that affect smallholder dairy farmer‟s access to formal and informal credit and also to evaluate its impact on animal performance in Uasin Gishu County. A sample of 64 smallholder dairy farmers was selected from Eldoret East, Eldoret South and Eldoret North districts of the County. Determinants of access to credit were estimated using descriptive statistics. The significant socio -economic determinants influencing borrowing were gender, age, marital status, religion, education, family size, farm size and interest rate. Results also revealed that access to credit enhanced animal performance and increased household income. Results obtained further indicated that commercial banks remain leading source of credit and, closely followed by friends, neighbours and relatives, with least attractive source being money lenders and traders. It is concluded from the study that socio-economic factors and collateral were highly important in influencing access to credit. Therefore, policy aimed to accelerate dairy productivity in Uasin Gishu County c ould be successful if these factors and problems are taken into consideration to access credit from both the formal and informal financial sources
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