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The Role Of Credit In The Farmer Support Programme: Is It The Key To Success?

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  • Coetzee, G. K.
  • Kirsten, J. F.
  • van Zyl, J.

Abstract

This paper concentrates on the credit element of Farmer Support Programmes (FSP) and the financial environment in which FSP credit is applied with a view to assess the importance of the credit component in the FSP. First, the theory on rural financial markets and intermediation is briefly reviewed. This is followed by an application to the FSP. The paper concludes with some policy implications of the findings. The main points that FSP financial policy should incorporate are: avoid loan subsidies and targeting; mobilise deposits; charge positive real rates of interest; avoid concessionary discount lines; reduce transaction costs; and emulate informal finance.

Suggested Citation

  • Coetzee, G. K. & Kirsten, J. F. & van Zyl, J., 1993. "The Role Of Credit In The Farmer Support Programme: Is It The Key To Success?," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 32(4), December.
    • Handle: RePEc:ags:agreko:267598
    DOI: 10.22004/ag.econ.267598
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    References listed on IDEAS

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    1. Braverman, Avishay & Guasch, J. Luis, 1986. "Rural credit markets and institutions in developing countries: Lessons for policy analysis from practice and modern theory," World Development, Elsevier, vol. 14(10-11), pages 1253-1267.
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    Cited by:

    1. Oosthuizen, L.K., 1998. "Agriculture As A Driving Force Of Economic Development: Suggestions For Agricultural Development Policy In Southern Africa," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 37(4), pages 1-21, December.
    2. Lugemwa, W. H. & Darroch, M. A. G., 1995. "Discriminant Analysis Of Seasonal Agricultural Loan Repayment By Small-Scale Farmers In Transkei," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 34(4), December.

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    Keywords

    Agricultural Finance; Financial Economics;

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