Factors Influencing Agricultural Credits Repayment Performance among Farmers in East Azarbaijan Province of Iran | ||
| Journal of Agricultural Science and Technology | ||
| Article 2, Volume 17, Issue 5, 2015, Pages 1095-1101 PDF (118.16 K) | ||
| Authors | ||
| E. Pishbahar* ; M. Ghahremanzadeh; M. Ainollahi; R. Ferdowsi | ||
| Department of Agricultural Economics, Faculty of Agriculture, University of Tabriz , Tabriz, Islamic Republic of Iran. | ||
| Abstract | ||
| One of the main challenges facing the Agriculture Bank of Iran regarding lending loans is the high probability of default by farmers. Several factors could be involved in this issue and should be considered in order to control and reduce the risk in the failure of repayment. This study aimed to examine the factors affecting the repayment performance of agricultural loans in the city of Maragheh in East Azarbaijan Province of Iran. Required data were obtained from a sample of 779 individual farmers who had previously received loans from Agricultural Bank during the period 2004-2008. Nested Logit Model (NLM) was applied for analyzing the data and, for this purpose, STATA software was used in the study. Results revealed that having an activity besides farming, extension of the repayment period of the loan, and large volume of received loans are the factors that had significant negative impacts on loan repayment. On the other hand, factors including high interest rates of loans, having collateral of guarantor, services received from the banks, and long term maturity period for the loans increase the probability of timely loan repayment significantly. | ||
| Keywords | ||
| Agricultural bank; Agricultural credits; Nested logit model; Probability of repayment failure; Repayment performance | ||
| References | ||
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