Determinant of microfinance programmes ’Participation among Small Farmers: An Experience of Rwanda Eularie Mutamuliza*, Vishwanatha** * Research Scholar, Mangalore University, Department of Economics, Mangalagangothri, Mangalore, Karnataka ** Professor and Chairman of the, Department of Economics, Mangalore University, Mangalagangothri, Mangalore, Karnataka Online published on 28 July, 2016. Abstract This paper was carried out in Rwanda to analyze the factors that influence small farmers ’decision to participate in microfinance programmes. In Rwanda, most commercial banks and other financial Institutions have shown little interest in providing credit to small farmers. Furthermore, these formal institutions demand collateral and other rigid requirements that are difficult for farmers to meet. Therefore, not much scientific research has been done in Rwanda where the majority of small scale farmers who depend on agriculture for their livelihoods do not have facilities to access the microfinance programmes for increasing their agricultural productivity. The analysis was based on household data collected from a survey of 240 smallholding farmers in Nyamagabe District located in Southern Province of Rwanda. Logit model and Descriptive statistics were used to analyze the data. The results from Logit model showed that age, education, home savings, annual total assets and off-farm income influenced the small farmers ’decision to participate in microfinance programmes. The result from descriptive analysis showed that in Nyamagabe District, more men than women participated in microfinance activities and that 48.8 percent of the respondents had participated in microfinance programmes and 51.2 percent of the respondents did not participate in microfinance programmes. The results shows also that the main factors limiting small farmers to participate in microfinance programmes are lack of collateral, lack of awareness, lack of information, difficult loan condition and long distance from the homestead and microfinance office. The study finds that participation in microfinance programmes should improve small farmers ’livelihoods. The emphasis should be put on the level of savings mobilization, so that small farmers could have a chance to participate in well functioning microfinance programmes for increasing their income and agricultural productivity. Top Keywords Microfinance programmes, Small farmers, Participation, Logit Model, Rwanda. Top |