Provision of agricultural credit to shall holder farmers in Dangme West District, Ghana

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The study clearly illustrates the importance of the small holder crop farmer in the economy of Dangme West District and Ghana as a whole. A number of problems affecting the productivity of farmers are mentioned but the study critically assesses the availability of production credit which was identified as one of the most important factors contributing to low agricultural productivity in the district A number of objectives were set out, with much emphasis on an understanding of the characteristics and operations of the rural financial market in the district. The informal credit market mainly the money lenders were found to dominate the credit market due inter alia, to easy accessibility and low transaction cost allied to its vast resource existing as unused financial potential. Alternatively, the rigid credit worthy assessment criteria including the possession of collateral securities applied by formal credit institutions, mainly the banks, the high rate of illiteracy, low level of organization and high default rates among farmers were identified as contributing to the status quo of • credit availability. Strategies aimed at alleviating the situation are discussed with greater emphasis on improving accessibility to farmers and the need to mobilize savings and reduce dependence on external sources of finance in a move towards attaining a more sustainable credit market. The need to organise farmers into viable working groups and application of peer monitoring and pressure were also stressed.
A thesis submitted to the Board of Postgraduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirements for the award of the Degree of Master of Science in Development Planning and Management, 1991