The Participation Levels of Smallholder Maize Farmers in Group Microcredit in Murang'a County, Kenya

Authors

  • Mbugua Elijah Wamunyu Kenyatta University
  • Eric K. Bett Kenyatta University
  • Ibrahim Macharia Kenyatta University

Abstract

Availability, accessibility and affordability of rural credit is one of the key elements for transforming rural economies through enhancing agricultural productivity, food security and poverty reduction. A good number of farmers in Murang'a County have engaged micro credit to boost maize production but the difference in productivity between beneficiaries and non beneficiaries have not been evaluated. This study sought to examine the contribution of Microfinance services to food security of smallholder farmers in Murang'a County. Descriptive and econometric analysis, were used to analyze the data. Primary data was collected from 200 respondents randomly selected from credit beneficially and non-beneficially groups in Kiharu constituency using a structured questionnaire.  The study uses the 'counterfactual' approach using propensity score matching to assess whether households who had participated in microfinance services had increased their maize yield compared to non-participants. Multivariate logistic regression showed that the proportion of land allocated to maize production had a positive and significant association with credit borrowing. The results also indicated a positive and significant relationship between group membership and credit borrowing. With regards to interest on loan and credit, a positive and significant relationship existed.  In addition, the results revealed that the frequency of group meetings had a positive and significant effect on the credit borrowed. The study recommends that small-scale farmers can work together as a recognized legalized entity in order to improve their bargaining ability and to take advantage of economies of scale. In addition, commercial banks are yet to exploit their full potential with regards to credit provision to high-potential small-scale resource constrained farmers.

Keywords: Smallholder Maize Farmers, Group Microcredit, Murang'a County, Kenya

Author Biographies

Mbugua Elijah Wamunyu, Kenyatta University

Post graduate student

Department of Agribusiness Management and Trade

 

Eric K. Bett, Kenyatta University

Lecturer

Department of Agribusiness Management and Trade

 

Ibrahim Macharia, Kenyatta University

Lecturer

Department of Agribusiness Management and Trade

 

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Published

2017-12-20

How to Cite

Wamunyu, M. E., Bett, E. K., & Macharia, I. (2017). The Participation Levels of Smallholder Maize Farmers in Group Microcredit in Murang’a County, Kenya. Journal of Agriculture, 1(1), 17–28. Retrieved from https://stratfordjournals.org/journals/index.php/journal-of-agriculture/article/view/80

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