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Assessment of the Impact of Zimbabwe’s Financial Sector Reforms on the Growth of the Agriculture Credit Market

Author

Listed:
  • Authur Masuka

    (757 Sumben, Mt Pleasant Harare, Zimbabwe)

  • Tanyaradzwa Rukasha

    (Department of Agribusiness and Management, Marondera University of Agricultural Science and Technology, P.O. Box 35, Marondera, Zimbabwe)

  • Simbarashe Tatsvarei

    (Department of Agricultural Business Development and Economics, University of Zimbabwe, P.O. Box MP167, Mt Pleasant, Harare, Zimbabwe)

Abstract

This study examines the impact of Zimbabwe’s financial sector reforms on the growth of the agricultural credit market, with a focus on smallholder farmers’ access to credit, loan sizes, and the choice of credit sources. Using data from 445 farmers in Mashonaland East, the study employs Propensity Score Matching, Multinomial Logit, and Ordered Logit models to estimate the causal effects of post-2009 reforms. Results show that exposure to reforms significantly increased access to credit and loan amounts, with training and financial literacy emerging as key enablers of formal credit use. Reform awareness and income levels were also positively associated with improved perceptions of financial access. The findings highlight that while financial reforms have expanded rural credit pathways, disparities persist across gender, education, and geography. The study recommends scaling up inclusive financial products, strengthening digital and financial literacy programs, and enhancing outreach through mobile and microfinance platforms. It concludes that financial sector reforms have positively influenced the agricultural credit market, though deeper institutional support and targeted delivery mechanisms are essential to ensure equitable and sustainable access. This research contributes to policy discourse on rural financial inclusion and offers actionable insights for enhancing agricultural finance in Zimbabwe’s evolving economic landscape.

Suggested Citation

  • Authur Masuka & Tanyaradzwa Rukasha & Simbarashe Tatsvarei, 2025. "Assessment of the Impact of Zimbabwe’s Financial Sector Reforms on the Growth of the Agriculture Credit Market," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(7), pages 5046-5057, July.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-7:p:5046-5057
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    References listed on IDEAS

    as
    1. Hasan, Amena & Dowla, Asif-Ud & Tarannum, Ramisa, 2024. "Financial Inclusion and Economic Growth in Developing Nations: A Case Study of Bangladesh," MPRA Paper 120213, University Library of Munich, Germany, revised 08 Feb 2024.
    2. Hamdiyah Alhassan & Benjamin Musah Abu & Paul Kwame Nkegbe, 2020. "Access to Credit, Farm Productivity and Market Participation in Ghana: A Conditional Mixed Process Approach," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 14(2), pages 226-246, May.
    3. Abiola Ayopo Babajide & Lawal Adedoyin Ishola & Adetiloye Kehinde Adekunle & Bede Uzoma Achugamonu & Akinjare Victoria Bosede, 2021. "Financial Sector Reform and Economic Development in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 11(2), pages 160-172.
    4. Olga Mapanje & Selma Karuaihe & Charles Machethe & Mao Amis, 2023. "Financing Sustainable Agriculture in Sub-Saharan Africa: A Review of the Role of Financial Technologies," Sustainability, MDPI, vol. 15(5), pages 1-20, March.
    5. Bogale, Fetene & Reta, Birku & Ayalew, Shibiru & Mehare, Abule, 2022. "Liberalizing Financial Sector in Ethiopia: Constraints, Consequences and Policy Issues," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 31(02), October.
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    7. Abiola Ayopo Babajide & Lawal Adedoyin Ishola & Adetiloye Kehinde Adekunle & Bede Uzoma Achugamonu & Akinjare Victoria Bosede, 2021. "Financial Sector Reform and Economic Development in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 11(2), pages 160-172, February.
    8. Lawrence Dumisani Nyathi & Mthulisi Nkala & Mbheki Mlobane, 2024. "Trade Openness and Total Sector Productivity in Zimbabwe: Empirical Analysis Using ARDL and Granger Casuality Approach," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(11), pages 2782-2793, November.
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