Factors Affecting Agricultural Input Loan Repayment in Southern Ethiopia: Evidence from Soro District

Abstract

This study was conducted to assess determinants that influencing smallholder farmers loan repayment in Soro district. Agricultural sector plays a key role in alleviating poverty. This study was aimed at investigating the determinants of input loan repayment in the Soro district using cross-sectional survey data gathered in 2018/19. A primary and secondary source of information through structured questionnaires, key informant interviews and focus group discussions were used. Descriptive analysis and econometric methods such as probit regression were employed for the data analysis. The probit regression result revealed that variables such as educational level, landholding, expenditure of household, crop income of household, credit borrowed to input, and owned oxen significantly influences smallholder agricultural input loan repayment. Hence, emphasis should be given to enhance loan repayment in the sector through by enhancing the practices of relatively agricultural input loan repayment in Soro district. Hence, enhanced loan repayment that will be a key to achieve alleviated poverty.