Is Micro-Finance Achieving Its Goal Among Smallholder Farmers in Africa? Empirical Evidence from Kenya Using Propensity Score Matching

With access to formal credit proving almost impossible to smallholder farmers, group based lending is steadily becoming popular in Africa. However, little is documented on the role of such programmes. In this paper, we employ propensity score matching method to evaluate effects of micro-finance credit (MFC) on borrower’s productive performance in Kenya. Our findings reveal that participation in MFC credit improves household productive incomes by a range of between US$ 200 and US$ 260 in a single production period. However, participation in the MFC among smallholder farmers is constrained by low literacy levels, gender differentials in asset endowment, poor road infrastructure, and maintenance of indigenous group structures as key factors for policy intervention

Issue Date:
Jun 24 2009
Publication Type:
Conference Paper/ Presentation
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Dr. George Owuor is an Agribusiness Specialist
Series Statement:
Contributed Paper

 Record created 2017-04-01, last modified 2020-10-28

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