An Investigation of the Access of Small Farmers to Rural Credits, Kohgilouyeh and Boirahmad Province

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Ordered Probit model was employed to investigate the factors affecting access to credit, allocated by Iran Agricultural Bank to the needy in Kohgilouieh and Boirahmad Province. Based on the received credits, farmers were divided into five groups and the model estimated for these groups. The required data were collected by filling up of a number of 198 questionnaires by farmers in Kohgilouieh and Boirahmad Province, selected through a simple random sampling method. Results indicated that such variables as literacy rate, total revenue and farm acreage have positive effects while the bank being a far distance away exert negative effects on access to credit. Since distance to bank is one of the key factors in a farmer's access to the credits, it is propounded that agricultural bank should increase its branches in suitable, and easily accessible locations of various rural areas to enhance small and eligible farmers' accessibility to the microcredit opportunities. Since land as an income distribution criterion affects access to credit, large farmers get an easier access to the credit. In this context, the bank should assist small and needy farmers through simplifying the requirements for their access to the microcredit.

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