An analysis of factors affecting access to credit in Lesotho's smallholder agricultural sector

An analysis of factors affecting access to credit in Lesotho's smallholder agricultural sector

Author: 
Motsoari, Charmaine
Publisher: 
Taylor & Francis Group
Date published: 
2015
Record type: 
Responsibility: 
Cloete, Philippus C., jt. author
van Schalkwykc, Herman D, jt. author
Journal Title: 
Development Southern Africa
Source: 
Development Southern Africa, Vol. 32, No. 5, September 2015, pp. 592-602
Abstract: 

The agricultural sector in Lesotho is underperforming mainly due to the inability of smallholders to move from traditional agriculture to a more scientific and technology-based one. Among the challenges inhibiting the ability of smallholders to make the step up is access to financial services, especially credit. The purpose of this study was to examine the factors that may influence the ability of smallholders to access finance by making use of a logistic regression model within the principle component regression framework. The results revealed that the ability of smallholders to access finance, and the potential to make the transition towards a more scientific and technology-based agriculture sector, is influenced by the level of farm and non-farm income, remittances and pension, farm size, availability of family labour, land ownership, savings and repayment ability. The results present important information in terms of guiding institutional arrangements needed to improve credit availability in Lesotho.

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Country focus: 

CITATION: Motsoari, Charmaine. An analysis of factors affecting access to credit in Lesotho's smallholder agricultural sector . : Taylor & Francis Group , 2015. Development Southern Africa, Vol. 32, No. 5, September 2015, pp. 592-602 - Available at: http://library.au.int/analysis-factors-affecting-access-credit-lesothos-smallholder-agricultural-sector-0