4.7 Article

Can Joining the Agricultural Industry Chain Alleviate the Problem of Credit Rationing for Farmers?

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Summary: Credit constraint is a significant barrier to the adoption of modern agricultural technologies and low agricultural productivity in low- and middle-income countries. This study finds that both supply-side and demand-side factors contribute to credit constraints for smallholder agricultural households in Ethiopia and Tanzania. The results also indicate that credit constraints have a gender-differentiated impact, with women more likely to be affected in both countries. The study suggests that policies should address both supply-side and demand-side credit constraints and consider targeted interventions to reduce risk and promote gender-sensitive credit policies.

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