CREDIT ACCESS FOR INCREASED PRODUCTIVITY AMONG YOUTH AGRIPRENEURS
Horticulture, an aspect of agriculture practiced by millions of youths across Africa, has helped with improving the livelihoods of a vast majority living in poverty and struggling to find employment. The continent hosts the world’s youngest population of around 200 million youths aged 15–24 years, with a large number of youth in rural areas engaging in farming activities, as a key source of livelihood.
Agriculture has been listed by stakeholders as a major tool for economic growth and food security, serving as an approach to Africa’s youth unemployment crisis. Although opportunities abound in the sector, they are still unrecognized and inaccessible to most young people. For instance, the high demand for agricultural products creates good opportunities, yet access to capital and credit for smallholders has been an existing problem, especially for young people.
In Tanzania, agriculture has strong ties to the country’s economic growth and food security, as it provides employment to almost 80% of the population, but the sector is characterized with low productivity due to constraints. According to Huldah Too, an IITA-CARE young researcher, youth farmers experience constraints such as lack of inputs, poor access to credit services, inadequate knowledge, and low infrastructural development.
In a study carried out to determine the perception of small scale youth tomato farmers on credit, and identify the determinants of credit access among them, it was discovered that men are more likely to access credit than women.
While analyzing the effect of credit access on tomato productivity among small scale youth tomato farmers, Huldah revealed that the age of the farmer, educational level, sex of the farmer, land size, farmer group membership, distance to the lending institution, and the annual income determined farmers’ access to credit in the Mvomero district of Tanzania where the study was carried out.
According to the IFAD sponsored study, being educated and belonging to a farmers’ group increases the likelihood of a farmer’s access to credit, while the distant location of lending institutions decreases this probability. Also, Huldah reveals that for rural farmers to have greater access to credit, governments and non-governmental organizations should promote education, literacy among farmers as well as in the farmer groups.
Financial institutions in Tanzania can consider reaching out to youth farmers living in rural areas to increase their awareness of lending services, borrowing procedures and requirements, states Huldah. While the government can explore investing in education since low literacy levels also hinders credit access according to the study.
With the IITA-CARE project focused on increasing the availability, and use of evidence for youth policies and decision-making related to youth participation in the rural sector, grantees are working in 10 countries across Africa to ensure youths are encouraged to adopt agribusiness and rural economy is improved.