Gender and Credit for Dairy Farmers in Uganda: The Case of the Uganda Commercial Bank Rural Farmers Scheme

Abstract

The objectives of this research were to assess the influence of gender and other socioeconomic factors on the sizes of loan allocated to dairy farmers in two districts in Uganda, and on the loan repayment performance of those farmers, in order to suggest some recommendations to improve the allocation to and use of credit by dairy farmers of the Uganda Commercial Bank Rural Farmers Scheme (UCB RFS). The relationship between the size of loans allocated to borrowers and the various socioeconomic variables was estimated using ordinary least squares. Tobit analysis was used to estimate the relationship between the same variables and repayment rate. Gender was found to be an important determinant of loan size: women received larger loans than men. Collateral, herd size and land area were significant determinants of loan size. Borrowers with collateral received larger loans than those without. Loan size increased with increases in herd size and household size. It decreased with increases in land area for men borrowers, but increased with increases in land area for women.