Credit access and intensity of borrowing by irrigated rice farmers in Ghana: the role of extension services
Journal of Agribusiness in Developing and Emerging Economies
ISSN: 2044-0839
Article publication date: 26 June 2023
Abstract
Purpose
Credit is essential in the farm business because it facilitates the adoption of productive technologies such as irrigation. However, access to credit remains a significant hurdle for sub-Saharan Africa, including Ghanaian farmers. Therefore, the authors assessed credit utilization and the intensity of borrowing by irrigated rice farmers in the Upper East region. In addition, how extension moderates the amount borrowed was analysed.
Design/methodology/approach
The multistage sampling approach was used in the study. The Tono and Vea irrigation schemes were purposively selected. Proportionally, 318 rice farmers were sampled from the Tono irrigation scheme and 159 from the Vea irrigation scheme. Cragg's double hurdle and moderation analysis were used.
Findings
It was uncovered that gender, age, years of farming, total farm size, rice farm size, contract farming and off-farm employment explain farmers' decision to borrow. On the other hand, the intensity of borrowing was influenced by gender, age, years of farming, rice farm size, contract farming and the number of extension contact. The moderation analysis revealed that extension contact improves the amount borrowed by farmers.
Research limitations/implications
While there are irrigated rice farmers in other regions of Ghana, this study was limited to rice farmers under the Tono and Vea Irrigation schemes in the Upper East region.
Originality/value
This study investigated the moderating role of extension contact on amount borrowed in Ghana. This makes a modest addition to the limited literature on the moderating role of extension and credit access.
Keywords
Acknowledgements
USAID funded this research through the International Centre for Evaluation and Development (ICED) under project number “AL-IN-85-8154” titled “Bundling Small-Scale Irrigation and Drought Index Insurance to Manage Smallholder Income Risk and Expanding Their Access to Agricultural Credit”. The authors acknowledge the support of the Feed the Future Innovation Lab for Markets, Risk & Resilience (MRR) at UC Davis. Also, the authors are grateful to the farmers under the Tono and Vea irrigation schemes for the tremendous support and for being available for this study. Also, the authors highly appreciate the help of the Irrigation Company of Upper Region and Savanna Agricultural Research Institute.
Citation
Kyire, S.K.C., Bannor, R.K., Kuwornu, J.K.M. and Oppong-Kyeremeh, H. (2023), "Credit access and intensity of borrowing by irrigated rice farmers in Ghana: the role of extension services", Journal of Agribusiness in Developing and Emerging Economies, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JADEE-02-2023-0036
Publisher
:Emerald Publishing Limited
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