Assessment of the rice farmer's credit needs and utilization of credit in Gubat, Sorsogon, 2014-2015

Date

6-2016

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Salvador P. Catelo

Abstract

The study was carried out to assess the credit needs and utilization of credit by the rice farmers in Gubat, Sorsogon in 2014-2015. Particularly, it 1) describe the socio-economic characteristics and credit needs of the farmers 2) determined the credit sources in the area and its accessibility to the rice farmers. 3) Identified the factors affecting the credit needs of the rice farmers 4) analyzed the credit utilization of the rice farmers and 5) identified problems faced by the rice farmers in accessing credit, and recommended possible solutions. Sixty six randomly selected rice farmers were interviewed with the aid of a pre-tested questionnaire. Descriptive analysis and multiple linear regressions were the core analytical tools used in the study. Generally, the rice farmers had been farming for 25 years with an average farm size of 0.81 hectares. Majority (56%) of them owned the land that they were cultivating. The average income of the farmers was Php 61,589 during the dry season and Php 43, 070 during the wet season. However, the household expense and debt payments were Php 107,370 and Php 128,685 for the dry season and wet seasons were Php 44, 188 and Php 42, 6954, respectively. Therefore the farmers credit needs for the dry season was Php 89,970 whereas for the wet season, it was Php 128, 309. Also, credit needs for wet season was affected by the incidence of pests and diseases along with low farm gate price of palay which resulted to low income from rice farming. The formal credit sources in the municipality were the Gubat Saint Anthony Cooperative andASA Philippines. On the other hand, the informal credit sources were private moneylenders, friends and relatives. It was found that most (79%) of the farmers preferred to access the credit services of formal letters. Furthermore, the primary problem in accessing credit by borrowers of formal lenders was too much requirements. The regression analysis revealed that the farm size, tenure status, household expense, and farm expense positively influenced the yearly credit needs of the rice farmers. Conversely, the total income had a negative relationship with the yearly credit needs. In terms of credit utilization, portion of the acquired loan (47%) was diverted to non-farm purposes. Furthermore, it was found that farmers who properly utilized their credit for farm purposes had higher net income by Php 21, 798 compared to those who mutualized their acquired loan. Based from the findings of the study, the following were recommended provision of additional livelihood programs for the farmers, simplification of documentary requirements by formal lenders separation of farmers loans for farm and non-farm purposes and proper utilization of credit by the farmers.

Language

English

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2016 A14 Q57

Document Type

Thesis

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