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Credit margin of investment in the agricultural sector and credit fungibility: the case of smallholders of district Shikarpur, Sindh, Pakistan

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  • Abbas Ali Chandio

    (Sichuan Agricultural University)

  • Yuansheng Jiang

    (Sichuan Agricultural University)

  • Abdul Rehman

    (Anhui University Hefei)

Abstract

Background This study examines the access to credit, credit investment, and credit fungibility for small-holder farmers and medium- and large-scale farmers in the agricultural sector of the Shikarpur District of Sindh, Pakistan. Methods A standardized questionnaire was used to collect data from 87 farmers in the Shikarpur District. We investigated the availability of credit and the use of credit fungibility by farmers with small-, medium-, and large-scale holdings by applying a credit fungibility ratio and an ANOVA technique. The factors that influence the farmers’ access to agricultural credit were analyzed using a probit regression model. Results The results revealed that farmers in both study groups used some amount of their agricultural credit for non-agricultural activities. Further, the results of the probit regression analysis showed that formal education, farming experience, household size, and farm size had a positive and significant influence on the farmers’ access to agricultural credit. Conclusion Based on these findings, our study suggests that a strong monitoring of farmers is needed in the study area.

Suggested Citation

  • Abbas Ali Chandio & Yuansheng Jiang & Abdul Rehman, 2018. "Credit margin of investment in the agricultural sector and credit fungibility: the case of smallholders of district Shikarpur, Sindh, Pakistan," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 4(1), pages 1-10, December.
    • Handle: RePEc:spr:fininn:v:4:y:2018:i:1:d:10.1186_s40854-018-0109-x
    DOI: 10.1186/s40854-018-0109-x
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    2. Haseeb Tufail Moryani & Shuqiong Kong & Jiangkun Du & Jianguo Bao, 2020. "Health Risk Assessment of Heavy Metals Accumulated on PM 2.5 Fractioned Road Dust from Two Cities of Pakistan," IJERPH, MDPI, vol. 17(19), pages 1-21, September.
    3. Martinson Ankrah Twumasi & Abbas Ali Chandio & Ghulam Raza Sargani & Isaac Asare & Huaquan Zhang, 2022. "Off-Farm Employment and Agricultural Credit Fungibility Nexus in Rural Ghana," Sustainability, MDPI, vol. 14(15), pages 1-15, July.
    4. Xiang Yin & Zhiyi Meng & Xin Yi & Yong Wang & Xia Hua, 2021. "Are “Internet+” tactics the key to poverty alleviation in China’s rural ethnic minority areas? Empirical evidence from Sichuan Province," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 7(1), pages 1-19, December.
    5. Ali Raza & Guangji Tong & Furqan Sikandar & Vasilii Erokhin & Zhang Tong, 2023. "Financial Literacy and Credit Accessibility of Rice Farmers in Pakistan: Analysis for Central Punjab and Khyber Pakhtunkhwa Regions," Sustainability, MDPI, vol. 15(4), pages 1-24, February.

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