Assessing the Level of Financial Inclusion of Rice Farmer Households and its Impact on their Incomes, Tayabas, Quezon, 2025

Date

6-2025

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Geny F. Lapiña

Committee Member

Maria Angeles O. Catelo

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Abstract

Financial inclusion is significant in the agricultural sector by enabling unbanked and underbanked rice farmers to be part of the financial system and acquire capital. The study assessed the level of financial inclusion and its impact on the incomes in Tayabas, Quezon. Specifically, the study sought to (1) describe the banks, and non-banks in the study area, socio-economic, farm, and distance to financial institutions of rice farmers; (2) assess the level of financial inclusion of rice farmers; (3) identify the determinants of rice farmers’ level of financial inclusion; (4) identify the perceived barriers to account ownership; (5) identify the alternative borrowing sources and financial worries of rice farmers; (6) examine the relationship of the ratio of farm income to household income and level of financial inclusion; and (7) provide recommendations based on the result of this study. The 2024 wet season was the cropping season considered in the study.

Primary data were gathered using a pre-tested questionnaire. Ninety-six randomly selected rice farmers were interviewed from nine barangays in Tayabas, Quezon; Masin, Ilasan Ilaya, Lalo, Katigan Silangan, Baguio, Ilasan Ibaba, Talolong, Nangka Ilaya and Potol. Cochran's formula was used to determine the sample size. Cost and Returns analysis was used to determine farm and household income. To evaluate financial inclusion, a Likert scale and Poisson regression were used.

Of the 96 rice farmers respondents in the 2024 wet season, 20 (20.83%) do not own any financial products or services. Poisson regression identified another family member owning an account as a determinant of account ownership. On the other hand, age, income ratio, a family member owning an account, and the volume of transactions were determinants of account usage. For account quality, rice farmer respondents were satisfied with convenience or proximity and security in usage; however, there was a need to improve affordability and sufficiency of information provided. Involuntary barriers for those with an account included the perception that services were “too expensive.” For those without an account, the main reasons were “too far away,” “too expensive,” and “trust to financial institutions.” Voluntary barriers for those with and without an account included “not enough money,” “family already has an account,” and “no need for financial services.” Furthermore, rice farmers worry the most about not being able to pay for medical costs in case of a serious illness and worry the least about not being able to pay monthly bills or expenses. Lastly, most farmers who rely solely on farm income do not transact with financial institutions.

Based on the results, the study recommended the following: (1) explore designing age-appropriate offerings; (2) giving incentives for farmers to engage more in the financial system and offering financial literacy; (3) exploring flexible credit and streamlining processes for account opening and credit applications; (4) DA can partner with mobile money account providers in the distribution of government subsidy; and (5) addressing transportation cost to financial institutions.

Language

English

LC Subject

Rice farming—Philippines, Farm income, Financial institutions—Management

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2025 A14 P34

Notes

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Document Type

Thesis

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