Farmers’ satisfaction with Agricultural Credit: The case of Greece

The existence of an appropriate institutional framework pertaining to the financial system in agriculture, that will support efficient financial mediation, reduce transaction costs, and facilitate the farmers’ access to loaned capital on favourable terms, is considered to be an essential step as regards the course of competitiveness in Greek agriculture. This paper is based on an empirical study on a sample of farmers. The aim of this research study is to examine the farmers’ satisfaction with current structures and services related to agricultural credit, as provided in Greece at present. On a second level, this objective of this paper is to develop a typology of farmers, based on their satisfaction structures (by a methodological scheme based on Principal Axes Factoring (PAF), Hierarchical and K-Means Cluster Analysis). The results of this typology will allow for conclusions and proposals to be deduced, regarding the potential for improving agricultural credit, with the growth of the agricultural sector as the ultimate aim. The PAF highlighted five factors-dimensions that can be used to analyze the farmers’ satisfaction with agricultural credit. The first and most important factor is linked to the financial terms of credit and to transaction costs. The second focuses on the human aspect of services, on facilities and equipment. The third factor pertains to the possibility of receiving such services on a personal basis. The fourth is linked to the terms of lending, and the fifth factor exclusively defines the particular properties of agricultural credit.