Impact of the Small Farmers Credit Program on farm output, net income, and the adoption of new methods: a Nepalese case study
Rokaya, C.M.
Research Paper Series, HMG USAID A/D/C Project on Strengthening Institutional Capacity in the Food and Agricultural Sector in Nepal, Agricultural Projects Services Centre 15: 14
1983
Document Number: 279971
Using data collected in 1978 from 80 randomly selected farmers of the Small Farmers Development Project in Nuwakot District, this study assesses the impact of agricultural credit on farm output, net income, and the adoption of new agricultural methods, and examines the relationship of small farmers' personality attributes to the adoption of new methods and to institutional borrowing. It shows that the provision of agricultural credit to small farmers is likely to increase farm output and net income through increased cropping intensity, but unlikely to affect the adoption of new methods: all respondents devoted most of their land to traditional crops, and there was under-investment in modern inputs. The farmers' income levels, educational levels, and attitudes towards risk and institutional credit were factors which influenced their adoption of new methods and their use of credit, with perceived risk being the most important determinant of decisions in both areas.