Assessment of credit behavior of onion farmers in Bongabon, Nueva Ecija, 2016

Date

6-2016

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Marilyn M. Elauria

Abstract

In view of the importance of credit to agriculture, it is the objective of this study to provide an assessment of the credit behavior of onion farmers in Bongabon, Nueva Ecija. To attain this objective, the analytical methods such as, 1) Chi-Square Test of Independence, 2) Multiple Linear Regression Analysis, 3) Loan Repayment Rate Analysis, 4) Correlation Analysis and 5) Tobit Regression Analysis were employed. The primary data were gathered from 50 onion farmers. Data from secondary sources were also obtained to further assess the behavior of onion farmers towards credit. The results of the analyses showed that all of the respondents were highly dependent on the credit that they availed mostly from in formal sources due to the reasons that it was more accessible, these sources do not require too many papers, and farmers find it more comfortable to borrow from them. Also most of the framers have a net cash flow that could not compensate all the farm and production expenses for the next season. The Chi-Square analysis showed that there was as association between credit needs and farm size. It was found out that households expenses and farm size significantly and positively affected the credit needs of onion farmers through multiple linear regression. One of the factors that assessed the credit behavior was the credit availment. The study found that majority of the respondents did not utilize all the credit for its intended purpose which resulted to a moderate repayment rate. Farmers do not have other sources of income and thus depend only on the revenue that they will get from producing and selling onions. Also, the respondents who have higher degree of credit utilization were also the ones who also have higher repayment rate. On the other extreme, the framers credit behavior indicators such as household expenses and household incomes have strong relationship with credit needs, while other indicators such as educational attainment, household size, household income, household expenses, farm size, and tears in farming resulted to be correlated with the credit utilization of the respondents. Thus, proper utilization of credit in effect led to higher repayment rate among the onion farmers in Nueva Ecija. The study also discovered that the amount of loan received, release of loan, and its interest rate per year have a significant but negative relationship with the repayment rate. This means that any increase in this variable would result to a lower repayment rate performance. Thus, the study recommended that formal sources of credit should ease the credit availment procedure, provide farmers production cost. If devise and implement assistance program that will lower the farmers production cost. If possible, they should be given training and assistance to enhance their credit behavior, which can be assessed through the farmer?s credit needs, availment and repayment performance that can lead to more profitable farm business.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2016 A14 S86

Document Type

Thesis

This document is currently not available here.

Share

COinS