A Dissertation Submitted in Partial/ Fulfillment of the Requirements for the Master of Science in Accounting and Finance of Mzumbe University
The problem of access to credit facilities is very critical to smallholder rice farmers specifically in rural areas. Several studies have been conducted to address the issue of poor access to credit facing smallholder rice farmers. However, no such study has been conducted in Tanzania, specifically in Mbarali District, where there are a good number of smallholder rice farmers. Moreover no study has attempted to assess the influence of access to credit facilities on performance of smallholder rice farmers. This study was intended to bridge this knowledge gap.
The study used quantitative analysis approach to establish cause and effect relationship between variables. The study employed survey research design and three years data were collected from 300 respondents in Mbarali District. Poison Regression Model was used to estimate the factors affecting access to formal credit facilities while factors influencing production performance of smallholder rice farmers in Mbarali District, were estimated using OLS regression model. The findings revealed that collateral value, credit size, interest rate, transaction costs and savings are the main factors affecting access to credit facilities by smallholder rice farmers. Access to formal credit facilities, credit size and farm size are the factors influencing production performance of smallholder rice farmers.
The study makes contribution to the knowledge on factors affecting factors affecting credit accessibility of smallholder rice farmers in Tanzania. Furthermore the study offers empirical evidence that access to formal credit facilities improves the performance of the smallholder rice farmers in Tanzania.