1.2. Objectives
Recent work has focused on evaluating the access to finance at
the farmers' level (Gamage, 2013), however, there is limited evidence on the
role of Financing Institutions (Meyer R. L., 2002), in particular, in new
approaches such as Agricultural Value Chain Finance. This master's thesis aims
to build a database of financial institutions that fund agriculture in the
Global South. A number of different financial institutions are included in the
database, including a range of institutional types and banking experience, as
well as the services offered by each institution. Following that, a descriptive
analysis of the data from these institutions will describe the basic features
of the data. This analysis will provide simple summaries of data and draw
conclusions from it. A later study can use this database to conduct the online
questionnaire with these FIs. This will enable research staff to determine the
methods that financial institutions use about credit screening, scoring, and
agricultural value chain financing. A part of this thesis involves analyzing
the existing questionnaire and preparing the basis for the design of the
questionnaires [Annex C]. From this database, a cluster analysis using R
will be able to draw conclusions about lending to farmers and credit for value
chain participants. The aim of this study is to provide robust evidence
regarding the similarities and differences between financial institutions when
it comes to offering rural services to their clients.
1.3. Research questions and hypothesis
The present study will focus on the role of financial
institutions in implementing value chain finance in the Global South. This
study will address the following questions:
1) What are the key underlying characteristics of credit
provision of different types of financial institutions in the Global South?
2) What is the extent to which financial institutions promote
gender issues and offer digital solutions?
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3) What kind similarities and differences can be observed
between financial institutions? As a result, the present work highlights the
subsequent main hypotheses H1, H2 and H3:
H1: Various trends can be seen on the basis of the variables
concerning the provision of credit by different types of financial institutions
in the Global South.
H2: Only a few financial institutions deal with gender issues
and offer digital solutions
H3: Financial institutions show several similarities and
differences in credit provisions, gender programs, and digital solutions.
1.4. Expected results from the research
The expected outcomes of this study are:
i. A database of financial institutions which fund agriculture
in the Global South.
ii. Data-driven evaluation of financial institutions' services
in the Global South
iii. An agenda for agricultural finance policy
recommendations
1.5. Organization of the thesis
Throughout this study, six sections are discussed. The
following part is a literature review which covers theoretical perspectives
about agriculture finance, AVCF definitions and challenges, and a review of
available papers, as well as agricultural credit determinants. In the third
section, we describe the study, the way the database was built, and the
statistical methods used. The fourth section focuses on the design of the
survey. In part five, we examine the results of our descriptive and cluster
analyses. Lastly, the fifth part summarizes the findings, discusses them, and
makes policy recommendations. The Annex «C» contains the
survey.
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