Agricultural Finance Research Articles

Sustainability and Strategy of Vegetable Crops Enterprises Based on Integrated Pest Management (Case Study in Mekarsaluyu Village, Cimenyan Subdistrict, Bandung Regency)

Crop enterprises in Mekarsaluyu Village, Cimenyan Subdistrict, Bandung Regency have contributed to the economic activities of the local community. However, current vegetable crop enterprises are not suitable for the sustainable agriculture concept and face several obstacles in its sustainability, such as the availability of water, access to capital, farmers’ concern for environmental sustainability, as well as the role of farmer groups and farmer group association. Integrated pest management (IPM) is a sustainable agricultural production subsystem that can help control pests on vegetable crops, with the use of pesticides as a last resort. This study aims to assess the sustainability status and formulate a farming management strategy based on IPM. The sustainability status was analyzed using the uses the RAP-IPM (Rapid Appraisal for Integrated Pest Management) method which is a modification of the RAPFISH (Rapid Appraisal for Fisheries), and strategy was analyzed using the SWOT and the QSPM method. Respondents were determined by purposive sampling. The sustainability status of vegetable farming based on IPM tends to be quite sustainable with a sustainability index value of 58.23% and the prioritized management strategies are (1) strengthening farmer institutions including farmer groups and farmer groups associations, marketing institutions, and business groups agriculture in meeting the need for vegetable demand in the market; (2) development of environmentally friendly integrated pest control based control technology and preparation of effective and efficient alternative production facilities including land management, labor requirements, planting area in accordance with factual conditions in the field; and (3) strengthening agricultural financing institutions to meet the needs of agricultural production facilities and infrastructure.

Predicting Performance in an Introductory Agricultural Finance Course

Student performance in an introductory agricultural finance class was analyzed via a pre-test, post-test, and additional student information collected from 2018-2021. Regression analysis indicated that several common measures of academic performance and aptitude were linked to post-test scores. Surprisingly, students that had previously taken an agricultural management class and students interested in an agricultural lending career performed worse than other students. Performance differences based on gender and first generation student status were also identified.

Effects of Covid-19 on urban and peri-urban farmers in Central Zimbabwe

The COVID-19 pandemic has affected the global economy since its advent in 2020. The agricultural sector is among the sectors that have been significantly affected by the pandemic. The effect of the pandemic in the agriculture sector is cutting across all the value chains inclusive of production, marketing and input supply, among others. In addition, both small-scale and large-scale producers have been affected. This study looks at the effects of the COVID-19 pandemic on urban and peri-urban agriculture in Gweru, Zimbabwe with a view to derive lessons that can inform discussion on how the urban and peri-urban farmers can circumvent economic shocks such as COVID-19 in the future. Agriculture in and around urban areas is practised by a significant number of people in some continents including Africa. Urban and peri-urban agriculture has a noticeable contribution to food and nutrition security and has a potential to reduce poverty. Face -to -face interviews were conducted with a total of 40 individual farmers using a structured questionnaire and three virtual focus group discussions were held with a total of 24 farmers. Simple random sampling was used to select participants from a list of farmers provided by the Department of Agricultural Technical and Extension Services. Each member of the population had an equal chance of being selected. The study established that the pandemic has had several effects on these urban and peri-urban farmers including limited access to markets, loss of income, increased cost of farming, competition from non-traditional farmers, adoption of innovative delivery mechanisms, difficulty in accessing inputs and reduced farm labour. Farmers were forced to adopt information technology to enhance communication among themselves and other stakeholders. To protect and safeguard livelihoods within the agricultural system, the study recommends that the government increases spending on social safety nets for urban and peri-urban farmers, reform agricultural finance and improve financial support to smallholder farmers. Key words: COVID-19, Agriculture, Urban, Peri-Urban, Food Security, Information Technology, Safety Nets

Macroeconomic impact of agricultural financing reforms: a computable general equilibrium analysis of Nigeria

Purpose- The study analyzed the macroeconomic impact of agricultural financing reforms: a computable general equilibrium analysis of Nigeria. Specifically, the study evaluated the macroeconomic impact of the agricultural financing reforms on economic growth, and agricultural output. Methodology- This study employed time series data from secondary sources such as the Central Bank of Nigeria (CBN), the National Bureau of Statistics' (NBS) in conjunction with the World Bank Living Standard Measurement Study (LSMS) and Information from the Nigerian Living Standard Survey for 2019 was used to obtain shares of household income and expenditure which covered the period 2010-2022. Applying the economy-wide methodology of Computer General Equilibrium model on reformatted upgraded Social Accounting Matrix for Nigeria, Simulation Designs, and t- test. Findings- The study finds that agricultural financing reforms through a decrease in interest rates on agricultural loans by 10% and 8% have positive significant impact on economic growth. The results of the study also reveal that agricultural financing reforms through a decrease in interest rates on agricultural loans by 10% and 8% have positive significant impact on agricultural output. Conclusion- The two policy scenarios (10% and 8% reduction in interest rate on agricultural loans) were simulated and the results for both cases indicated that all the macroeconomic indicators increased significantly due to the policy options. Keywords: Macroeconomic impact, agricultural financing reforms, computable general equilibrium analysis, economic growth, Nigeria. JEL Codes: A11, B23, B41, C53, E47

Does The Existence of Sharia Microfinance Institutions Contribute to Agricultural Financing? (Study at BMT Khairul Amin Martapura)

Baitul Mal wa Tamwil (BMT) is a Microfinance institution that boosts the economy in the MSME sector. BMT is expected to reach the agricultural sector. In some cases, capital is still weak in the agricultural sector. The establishment of the BMT Khairul Amin Martapura Rangas River branch is expected to help the community, especially farmers, solve the capital problems. This research is field research using qualitative method approach. In addition to producing qualitative data results, this research uses a simple quantitative approach to strengthen the analysis results by explaining the data with numbers. There are six informants in the study. The results revealed that the existence and accessibility of BMT are pretty good. However, in the agricultural sector, it is still not good because the percentage of farmer customers is only 21.05%, and the financing disbursed is only 35.04%.

Influence of Enterprise Decision Making on Agribusiness Loans Default Rate in Agricultural Finance Corporation, Mount Kenya Region

Influence of Enterprise Decision Making on Agribusiness Loans Default Rate in Agricultural Finance Corporation, Mount Kenya Region

NECESSITY OF EDUCATION ABOUT IMPORTANCE AND POSSIBILITIES OF INSURANCE, FINANCING AND INNOVATIONS IN AGRICULTURE

Education is necessary for the development of all activities, and therefore for the development of agriculture. For the successful development of agricultural sector, in the contemporary conditions, an adequate agricultural policy is needed, which will encourage, through the series of measures and instruments, insurance, financing, introduction of innovations in agriculture, as well as many other elements important for sustainable development of agriculture. Since these are very dynamic factors, permanent education on such complex issues is necessary, in order to be sufficiently informed and knowledgeable farmers and consumers of agricultural products about all advantages and disadvantages of their business or consumer decisions. Bearing that in mind, within this research, the most important aspects of insurance, financing and introduction of innovations in agricultural sector are analysed, while the analysis of the aforementioned topics focuses on the necessity of education on these important issues. Anyway, education significantly determines the quantity and structure of agricultural production, and therefore the supply of agricultural products. Additionally, it significantly affects the shaping of demand for agri-food and other agricultural products. Accordingly, the aim of this research is to point out the relevance of insurance, quality financing and innovation in agriculture, with special emphasis on the role and importance of education for their application in the practice. The methods of description, comparison, analysis, synthesis, induction, deduction, generalization and historical method, are used in the paper. The most complex issues in the field of insurance, financing and innovative approaches in agriculture, which require adequate education, are presented schematically and illustrated with the table. The research results show that comprehensive education is really necessary when it comes to agriculture, which, like other activities, in the technical-technological and broader sense, is constantly improving and facing new challenges and requirements for sustainable development, i.e. balancing economic, ecological and social goals. Namely, it is observed in the paper that constant education must be an integral part of the modern approach to agricultural development, where the education about importance and possibilities of insurance, financing and introducing innovations, can provide the necessary knowledge and information to farmers and buyers of agricultural products. In the paper, it is concluded that the education, in various forms, can significantly motivate farmers to improve their business on a sustainable basis, and motivate consumers of agricultural products to opt for agricultural products that are at the same time acceptable in the economic-financial, ecological and the wider social context. It is extremely important in modern conditions, which are very complex and burdened with a number of global problems, such as climate changes, complicated international economic relations, health and other accompanying problems.

The current situation of agricultural financing and its impact on animal production in Qena Governorate

The current situation of agricultural financing and its impact on animal production in Qena Governorate

National Agricultural finance Strategy: Evidence from India

National Agricultural finance Strategy: Evidence from India

Impact of agricultural financing on agricultural output: the role of commercial banks

The study investigates the impact of agricultural financing by commercial banks on agricultural output in Nigeria. Agricultural sector contribution to GDP was used to define agricultural output, while the agricultural financing was defined by commercial bank credit to the agricultural sector. The study employed real interest rate and inflation rate as control variables. The time span under study was 40 years which dated from 1981-2020 using annual secondary data, Data on agricultural output and commercial bank agricultural financing, were obtained from the Nigerian central bank annual statistical bulletin(CBN) whereas interest rate and inflation rate were obtained from united nation conference on trade and development (UNCTAD). The Autoregressive Distribution Lag (ARDL) was adopted due to its efficiency, robustness and dynamic nature in time series analysis. It was discovered the explanatory variables under study only have a long run relationship with the explained variable. Specifically, commercial bank agricultural financing rate has a positive and substantial impact on agricultural output whereas real interest rate and inflation rate have a negative and insignificant relationship with agricultural output in the long run. The study recommends that reliable sources of agricultural financing should be developed and policies aimed at boosting allocation of credit to agricultural sector should be created and implemented correctly so as to increase agricultural output.

Effect of Borrower's Socio-Economic Profile on Agribusiness Loans Default Rate in Agricultural Finance Corporation, Mount Kenya Region

Background: Agribusiness loans advanced by Agricultural Finance Corporation (AFC) in Mount Kenya Region have high default rate of 20.33% which compares unfavourably with 10% benchmark for all types of loans in Kenya. This is a challenge, given the strategic importance of agribusiness credit in mainstreaming livelihoods to alleviate poverty by offering occupational and professional opportunities. This study aimed at analysing effect of borrower’s socio-economic profile on AFC loan default rate in agricultural finance corporation, Mount Kenya Region.
 Methods: According to AFC records Mount Kenya region represents a branch network of 11 branches and a population of 3,002 agribusiness borrowers. Using a descriptive research design a sample of 300 borrowers was drawn from a combined list through systematic random sampling technique with an interval of ten. Primary data on borrower’s socio-economic profile was collected using a structured questionnaire. The data was analysed using Statistical Packages for Social Sciences (SPSS V.27) and Stata version. Using regression analysis, the effect of independent and dependent variable to predict default rate was estimated. ANOVA was performed to get the F-statistic so as to test for the adequacy of the regression model. The logit econometric model was used to specify the statistical relationship between the independent variable and AFC loan default.
 Results: Results of the study revealed that multiple borrowing and borrower-lender distance were significant at 5%. Farming experience, borrowing experience and off-farm income were significant at 10%, 5% and 1% levels of significance. Multiple borrowing and borrower-lender distance were found to have 5.5% and 0.8% associations with default rate, respectively.
 Conclusion: The findings show that to mitigate default, the borrower should avoid multiple borrowing and manage the friction of distance. The study is significant since it enlightens the credit stakeholders on collective efforts that are effective in addressing the problem of default. The study recommends government interventionist policy by facilitating uptake of agricultural insurance and subsidizing input costs. Borrowers are encouraged to embrace technology, team up as farming communities to look for markets and affordable inputs, adopt agricultural insurances and adhere to lending directives.

Agricultural financing risk and ib agricultural financing: A long relationship

Indonesia is destined to be an agrarian country because of its location on the equator, unfortunately not all farmers are able to access capital for their agricultural businesses while the contribution of the agricultural sector to employment is very high. It is also important to consider that Indonesia is also a country with the largest Muslim population in the world, so there should be a financing scheme in the agricultural sector that is in accordance with sharia compliance. Therefore, Islamic banking should be present to provide capital to farmers who need agricultural financing without violating sharia provisions. Identifying variables that affect Islamic bank financing in the agricultural sector in the long run is the aim of this study so that our findings can be one of the considerations for policy makers for future policies. To reveal the purpose of our research, we consider the factors affecting the agricultural financing of Islamic banks which consist of the risk of agricultural financing, farmer welfare, inflation and economic growth with observations for a decade from 2012 to 2021 on a quarterly basis. By using ARDL estimation, our findings find that in the long run relationship the welfare of farmers has no effect, while the other remaining variables have a significant effect. This study offers valuable implications indicating that the presence of Islamic banking can be considered as a viable financial solution within the agricultural sector.

Evaluating the Magnitudes of Finance Availed by Farmers from Different Financial Agencies in the North-East Indian State of Tripura

The current research was carried out in the West Tripura district of Tripura to examine the magnitude of agricultural financing availed by borrowers. A total of 120 farmers were chosen by implementing a multistage random sampling design to conduct a comprehensive analysis. Sector-wise advances of banks in West Tripura showed an increasing trend, and the percentage share to the agricultural sector was 34.27 %, whereas it was 65.72 % in the non-farm sector in 2020-21. The amount of loans availed by sample borrowers from Regional Rural Bank (42.88%) was the highest, followed by public sector banks (34.48%), cooperative banks (19.80%) and least from private sector banks (1.84%). Loans for both crop and allied activities were obtained by the beneficiaries from the selected bank branches of the district.

How can an agri-environmental scheme be designed for farmland bird protection, and what does it mean for the CAP 2023–2027?

Biodiversity loss is recognized as a major global threat. The European Commission has addressed this issue with vigour in its current strategy papers. Farmland birds, such as the lapwing (Vanellus vanellus), whose population has been rapidly declining in Germany, have been particularly affected. To date, the European Union has tried to tackle the problem of biodiversity loss mainly with voluntary agri-environmental schemes (AESs), which are financed by the European Agricultural Fund for Rural Development (EAFRD). However, only a small fraction of agricultural land is enrolled in such programs. We identify the possible drivers and inhibitors of farmers’ acceptance of a potential AES that, if introduced, could contribute to lapwing conservation. Our analysis is based on a discrete choice experiment conducted with 252 arable farmers in Germany. The results suggest that scheme attributes tied with EAFRD compliance, i.e., a minimum participation period of five years and the nature of the relevant sanctions regime, reduce farmers’ potential acceptance of the proposed AES. Furthermore, farmers and farm characteristics have an influence on preferences for specific AES attributes. Finally, this article outlines how the identified weaknesses of AES may be addressed in the new “Green Architecture” of the Common Agricultural Policy 2023–2027.

Overcoming Obstacles to Agriculture Finance in India: A Vibrant Prospect of Agri-Entrepreneurship

The traditional agriculture in India used to be affected adversely by the delay in monsoon, drought, inferior quality of seeds and insufficiency of fertilizer and shortage of skilled labour etc. A clear vision of the Government, since independence, changed the environment of agriculture in the country to a great extent. Constant initiatives, in the form of promoting agri-financing by rural credit, infrastructural development, upliftment of standard of living of the farmers, supervisory role of regulatory bodies to provide banking services, strengthening rural financial institutions, have created a healthy ecosystem of agri-entrepreneurship. The increase in demand due to change in food habits of the people, combined with better purchasing power, is encouraging the entrepreneurs to come up with innovative products. The development of financial markets in India, to provide better financial services in the form of insurance and risk management etc., is bringing agrientrepreneurship on the threshold of a golden era.

Agricultural Financing - Agricultural Sector Output Nexus: A Case Study of The Nigerian Economy

The study “Agricultural Financing -Agricultural sector output nexus: in Nigeria” investigated the effect of agricultural financing, both public and private on the outputs of two main sectors of agriculture: crop production and livestock production. Three objectives were formulated to provide guide to this study: examine the long and short run relationship of agricultural financing on crop production output and livestock production output, and to examine the causal relationship between agricultural financing and agricultural sector output. To achieve these objectives, the study employed two models, each using ARDL Test, Bounds Test, and Granger causality test using time series data from 1981 to 2019.Data was obtained from CBN and World Bank data base. Dependent variables were Crop Production output and Livestock Production output respectively and independent variables were Public Finance, Commercial Bank Credit to Agriculture, Inflation Rate and Interest Rate. The model was tested using descriptive statistics to analyse the significance of the relationship between the dependent and independent variables. The results show that both public and private finance were positive but insignificant in the short run. In the long run, public finance remained insignificant whereas private finance was positive and significant. Thus, private financing is more effective at improving agricultural output than public finance. The study also revealed a negative long run relationship between interest rate and the outputs of crop and livestock production during the period. It is therefore recommended that the government encourages private investment in agricultural activity, and puts measures in place to curb corruption and embezzlement. Government should also ensure that credit facilities are provided to farmers at low interest rate to reduce detrimental influences.

Digital inclusive finance and total factor productivity in agriculture—— Evidence from China

Under the strategy of rural revitalization, the development of digital inclusive finance is an effective way to alleviate the long-standing problem of "difficult and expensive financing" in the "three rural areas", and is an inherent requirement for achieving high-quality development of Chinese agriculture. Based on the panel data of Chinese provinces from 2011 to 2021, this paper adopts a three-stage SBM-DEA model to measure the total factor productivity of agriculture and analyzes the impact of digital financial inclusion on total factor productivity of agriculture. The study shows that, firstly, the development of digital inclusive finance plays a more significant role in enhancing total factor productivity in agriculture, and the depth of use plays the strongest contributing role among the sub-indicators. Second, there is heterogeneity in the effects of digital inclusive finance on agricultural total factor productivity in terms of time and geographical location. Third, the mechanism analysis shows that deepening human capital and regional innovation capacity can effectively drive the growth of agricultural total factor productivity. The research in this paper contributes to a deeper understanding of how agricultural total factor productivity is measured, and the theoretical mechanisms by which digital inclusive finance drives agricultural total factor productivity.

Access to credit and agricultural productivity: Evidence from maize producers in Benin

Access to agricultural credit is still a challenge in developing countries. The weakness of agricultural financing prevents producers from acquiring the modern technologies that are essential for the development of their activity. This paper aims to determine the impact of access to credit on agricultural productivity in Benin using alternative measures of productivity. To do this, we use the endogenous switching regression model to control for potential selection and unobserved heterogeneity issues associated with this impact analysis. The data used comes from the statistical databases of the National Agricultural Research Institute of Benin. The results show that the adoption of improved seeds, the geographic location, the area sown and member of peasant organization determine producers’ access to credit are factors that determine producers’ access to credit. Farmers’ access to credit generates an estimated gain of 40.07% and 31.97% respectively for production per hectare and production per FCFA invested. These results require a comprehensive and coherent public action.

Relationship between Agricultural Financing and Agricultural Output in Nigeria

Relationship between Agricultural Financing and Agricultural Output in Nigeria

Analysis of IoT and Blockchain Technology for Agricultural Food Supply Chain Transactions

The Block chain is a peer to peer, distributed ledger in which members must establish consensus to record every new input and transactions that are stored by all members. Over the last decade, block chain technology has grown in popularity, attracting interest from a wide range of industries, including finance, manufacturing, energy, and government sectors, health, and agriculture supply chains, land registrations, and digital identifications (IDs). Block chain facilitates better opportunities and benefits in agriculture, as well as building trust between farmers and consumers and allowing the creation of reliable food supply chains. The Chapter discusses how block chain and smart contracts can improve productivity, transparency, and traceability in agricultural insurance, smart farming, and agricultural food supply chain transactions (AFSC). By applying Block chain agri-food supply chain tracking was made easy and won the trust from different stakeholders, which was a real benefit to the real heroes of the country. The consumer can research the history of a product they are thinking about buying and consume food in their cart, learning about the entire process from planting to harvesting, transporting, and selling. Food fraud may be reduced by using the traceability and integrity of financial information to detect untrustworthy intermediaries and business practices that exploit both independent farmers and cooperatives. The agricultural industry will be transformed by block chain for supply chain management. All phases of the agriculture supply chain are being simplified, enhancing food safety and preventing the sale of counterfeit goods. Access to agricultural finance services for farmers and companies could also be facilitated by the technology. This Paper presents a review and research challenges on the existing block chain based IoT applications in the agriculture domain where maximum research focuses on food supply chain and its security of Internet of things with Block chain. The chapter presents how block chain and smart contracts can increase productivity, transparency and traceability could be very effective in Agricultural insurance, smart farming, transactions of agricultural food supply chains.