Determinants of Financial Access for Smallholder Farmers in Thailand: Challenges, Credit Assessment Criteria, Credit Literacy, and Loan Access
Keywords:
Financial access, Smallholder farmers, Credit literacy, Rural financeAbstract
This study examines the factors that influence access to funding sources for small-scale farmers in Thailand, focusing on challenges in accessing financial resources (CAF), credit assessment criteria (CAC), credit knowledge (CL), and loan accessibility (LA). The objectives are: 1) to analyze the problems and obstacles farmers face when seeking financial support, 2) to assess the confirmatory components of the causal factors, and 3) to develop a structural equation model explaining how these factors relate to farmers’ access to funding sources. Data were collected through questionnaires from 442 small-scale farmers across 18 provinces, using stratified sampling. Structural equation modeling and confirmatory factor analysis were used to evaluate the relationships among the four latent variables. The findings indicate that the major barriers to accessing funding are the lack of collateral, limited credit knowledge, and insufficient financial documentation. More flexible credit criteria and improved credit knowledge can substantially increase loan accessibility, while difficulty in accessing loans may further restrict farmers’ credit knowledge. The study introduces a model that can support the development of more comprehensive and sustainable financial services and policies for small-scale farmers.
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