Rural Women Borrowers: Do They Consume the Loan or Invest Productively an Empirical Study in Wolaita Zone, Southern Ethiopia

Finance is an important instrument in rural development. Providing low-cost, efficient credit services and recovering the loans granted are fundamental functions in rural finance. Low repayment rate affects the liquidity of lenders and discourages them to extend further credit. Investigation of credit utilization is of great importance both for policy makers and the lending institutions. The objective of this study was to assess the status of credit utilization choice and socio-economic, demographic, psychological and institutional characteristics of rural women members of RuSACCOs (Rural Savings Credit Cooperatives) of Kindo Koysha Woreda in Wolaita Zone, Ethiopia. In the course of this study, primary data were collected from 96 sample women borrowers. The analysis was done using descriptive statistics such as mean, standard deviation and percentage. In addition, t-test and chi-square test were employed to compare groups which used the loan for productive purpose and those used for consumption purpose with respect to borrowers’ characteristics. The following categories of women borrowers were found to have higher tendency to use the loan for productive purposes rather than consumption purpose : Younger women, more educated, married, with lower dependency ratio, with higher household income and expenses, with higher livestock holding, with prior business engagement, having better access to road and market, who availed higher loan amount and having higher amount as savings from/in  RuSACCO, higher level of training, following weekly repayment rather than fortnightly or monthly and higher economic motivation. The study recommended that RuSACCOs need to follow up closely with women borrowers having the characteristics opposite of those aforementioned for ensuring productive use of credit and offer adequate training to them. Keywords: Women Borrowers, Microcredit utilization, micro-finance, rural credit, RuSACC

Econometric Analysis of Rural Credit Utilization and Repayment Status among Rural Women: A Case of Southern Ethiopia

Delivering productive credit to the rural women has been a key in rural development undertaking. Providing low-cost, efficient credit services and recovering the loans granted are fundamental functions in rural finance. Low repayment performance discourages the lender to extend further credit. Investigation of credit utilization and repayment is of great importance both for policy makers and the lending institutions. The major objective of this study was to identify the major socio-economic, demographic, psychological and institutional factors that affect credit utilization and repayment performance of women members of RuSACCOs of Kindo Koysha Woreda in Wolaita Zone of SNNPR State. In the course of this study, primary data were collected from 96 sample women households and secondary data collected from respective organizations in the study area. The analysis was done using econometric analysis using Binary logit model. Binary Logit Model was used to identify the factors influencing credit utilization and repayment performance of women microcredit borrowers from rural saving and credit cooperatives. 12 continuous explanatory variables and three dummy variables were included in the logit mode. The binary logit model for credit utilization and repayment tested 15 explanatory variables. Out of which, five variables were significant and the rest were insignificant to explain the dependent variables. The loan repayment was significantly influenced by market access, transport road access, prior business engagement of women before the loan and economic motivation. Similarly, Credit utilization was significantly affected by four variables which were age of women, prior business engagement of women before the loan, transport road access and economic motivation. Thus, the findings identified need to be reckoned and suitable strategy to be introduced by RuSACCO management and policy makers to improve the loan utilization and repayment performance of women. Keywords: RuSACCO, loan Repayment performance, Microcredit utilization, micro-financ

Perception of and response to climate change by maize-dependent smallholders

Smallholder crop producers in sub-Saharan Africa are adversely affected by climate change because of their reliance on rain for crop production. Promoting adaptation interventions at local scale is unlikely to be effective without understanding farmers' views on climate change. Our study analyzes climate change perceptions and responses by maize-dependent smallholders in Ethiopia. Household-level data on farmers' climate change perceptions and adaptation strategies were collected. In addition, meteorological data were obtained from local weather stations for the period 1985-2015. Descriptive statistics, standard rainfall anomalies, thematic content methods and binary logistic models were used to analyze the relationship between climate change perceptions and adaptations. Findings show that nearly all farmers perceived climate change through increased hot and warm days and nights as well as decreased precipitation volumes. Results indicate that farmers perceive shortened seasonal rainfall duration in terms of both late start and early end. Farmers employ a range of strategies, notably cropping date adjustment, improved crop variety use, crop diversification, agroforestry practices and seasonal migration to adapt to climate change. Farmers' adaptation decisions were mainly associated with their climate change perceptions as well as socio-economic factors such as education level and farm experience. It is, therefore, suggested that recognizing farmers' knowledge and experience on climate change would help develop context-specific, flexible adaptation strategies that better build resilience capacity

Adoption of climate change adaptation strategies by maize-dependent smallholders in Ethiopia

Climate change is an environmental process that is among the most limiting factors for increasing or even maintaining food production by small-farmer communities in Sub Saharan Africa (SSA). Adoption of climate change adaptation strategies that increase agricultural productivity and at the same time building farmers' resilience capacity has become a top policy priority in SSA. In this study, we investigate how maize-dependent smallholders in Ethiopia adapt to climate change. Both household and plot-level data were collected, and subsequently analysed by a multivariate probit regression model. Results show that most climate change adaptation strategies implemented by maize-dependent smallholders, are complementary. Combining conservation tillage, mixed maize-legume cropping and terracing along with the use of drought-resistant maize varieties allows farmers to increase productivity while building resilience to climate change more than a subset of these strategies. Findings indicate that the likelihood of adopting soil and water conservation practices, drought-resistant maize varieties and chemical fertilizers significantly increase among young and male-headed households as well as farmers having confidence in extension agents and membership in local organisations. Hence, policies should aim at further building agricultural extension agents' capacity by providing effective and continuous education and training on climate change impacts and responses. Promoting family ties and household memberships in local organisations through facilitating mutual cooperation and communication among farming communities would help to foster adoption of climate change adaptation strategies

Vulnerability to climate change among maize-dependent smallholders in three districts of Ethiopia

Climate change vulnerability may differ among small farming communities and depend on combinations of multiple social and biophysical processes. In this study, we assessed vulnerability to climate change among maize-dependent smallholders in three districts of Ethiopia. Household socio-demographic factors, land use system, access to food, natural hazard, livelihood strategy and social network data were collected and subsequently analysed by the livelihood vulnerability index and the Intergovernmental Panel on Climate Change Vulnerability Index approaches. Results show that within the same production system, smallholder farmers experience different degrees of climate change vulnerability. This variation in climate change vulnerability is highly and significantly explained by very localized socio-economic factors such as household educational level, access to drought-resistant crop varieties, extent of family ties with social groups and local organizations, and quality of rural water supply and health infrastructures along with biophysical factors like land size and soil fertility status. It is, therefore, suggested that recognizing smallholder farmers' relative vulnerability to climate change provides a range of effective coping strategies that would help to better build household resilience capacity and promote sustainable livelihood development. Hence, policymakers and development organizations need to focus on better strengthening human and institutional capacity through enhanced education and continuous training on climate change impact, and efficient and sustainable intensification through crop rotation, fertilizer use, rainwater harvesting and farm diversification that increase productivity by restoring soil and agroecosystem health