Abstract
Commercial banks are not interested in providing fund for community-based forest plantation development. Therefore, in this case, non bank institutions such Forest Development Funding Center (pusat pembiayaan pembangunan hutan, PPPH) are highly required. This paper is aimed to find out the effectiveness of private forest revolving fund distribution and factors affecting its repayment. The research was conducted during September–December 2014 in 3 Private Forest Farmer Groups in Katibung Sub-District, South Lampung District, Lampung Province. The data was collected through household surveys and in-depth interviews. The household surveys were done using structured questionnaires that included questions related to: characteristics of the borrowers, characteristics of private forest, characteristics of loan, and household perceptions on private forest revolving fund. Household perceptions on private forest revolving fund are pre requirement, loan procedure, loan realization, interest rate, length of repayment periode, and repayment procedure. The effectiveness of private forest revolving fund distribution was analyzed by likert scale and factors affecting repayment of loan was analyzed by logistic regression. The result showed that: 1) private forest revolving fund in three private forest farmer groups in Katibung Sub-District, South Lampung District was effective, 2) income from non-private forest and amount of loan are factors affecting repayment of private forest revolving fund, 3) the faced problem in private forest revolving fund distribution could be overcame by maximizing the role of PPPH field officers in assisting and facilitating private forest revolving fund debitors candidate.
Highlights
Most small scale farmers of less developed countries live invicious circle of poverty as they rarely generate income in excess of their consumption requirements that can be saved and used for investment activities (Shakya & Flinn 1985; Green & Ng'ong'ola 1993)
Private forest revolving fund Revolving fund scheme that is distributed for supporting the private forest activities in Lampung Province is in line with Ministry of Forestry Regulation Number P.36/Menhut-II/2012 about The procedure of credit distribution and repayment for land and rehabilitation program
Private forest revolving fund is implemented by using the loan scheme based on Article Number 8 (a) and without intermediary institution based on Article Number 10 (a)
Summary
Most small scale farmers of less developed countries live invicious circle of poverty as they rarely generate income in excess of their consumption requirements that can be saved and used for investment activities (Shakya & Flinn 1985; Green & Ng'ong'ola 1993). Lack of access to adequate financial services, especially credit is considered as one of the reasons for rural households to live in the vicious circle of poverty Even if such financial services are available, high default rate is one of the major concerns of financial institutions in less developed countries (Brehanua & Fufab 2008). The access of capital for community based plant private forest development in Indonesia has been implemented by the government since 1980s by launching credit for farmer activity in watershed area in 1988 by the Ministry of Forestry. It was not for forest development only, and for soil and water conservations using technical civil approach (Nugroho 2011). In 1997, loan for private forest development through credit for private forest activity were available
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