Determinants of Credit Availability among Farmers: A Case of Banana Tissue Culture§

Abstract

The technological improvements play vital role in enhancing the yield of agricultural crops. Tissue culture technology is a major intervention in banana, which have the potential to benefit the banana farmers in multiple ways. We have tested this by using primary survey of 100 farmers from the Gorakhpur district of Uttar Pradesh, a traditional sugarcane cultivated belt which is fast getting covered by banana plantations. Both adopters and non-adopters were surveyed and their adoption nature was studied by calculating cost and returns along with probit regression by using Hackman's selection bias model. It was found that availability of credit which affects the adoption behavior of farmers significantly along with age and farm income. Farmers those who are availing institutional credit mainly in the form KCC and term loans show more adoption behavior as compared to non-loanee farmers. The risk due to wind, drought and other abiotic factors were identified as the major constraints in the adoption of tissue culture banana in the region. Study emphasize the need for more financial assistance in the form of rural institutional credit, adequate and timely availability of quality inputs (especially planting materials) for better returns and thereby more adoption of high value crops.