What is the contribution of agricultural finance to farmer livelihoods?

Abstract

We assessed the contribution of agricultural development financing in rural development and farmer livelihoods in KwaZulu-Natal, using the Agribusiness Development Agency as a case study. Data was collected using structured questionnaires and in-depth key informant interviews from a purposefully selected sample of ADA beneficiaries, ADA officials and government stakeholders. The findings showed that farmers who had received financial and technical support experienced positive changes in their business operations. However, the ADA’s model for providing support and implementing activities does not allow for maximum participation from the beneficiaries. The beneficiaries have limited decision-making powers and minimal influence on overall project activities. The results of the study highlight the importance of targeted agricultural financing approaches, accompanied with capacity building of farmers.