Open AccessThe role of access to finance from different finance providers in production risks of horticulture in Indonesia
Author(s) -
Eliana Wulandari,
M.P.M. Meuwissen,
Maman H. Karmana,
A.G.J.M. Oude Lansink
Publication year - 2021
Publication title -
plos one
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.99
H-Index - 332
ISSN - 1932-6203
DOI - 10.1371/journal.pone.0257812
Subject(s) - production (economics) , business , finance , access to finance , supply chain , interactive kiosk , agriculture , financial risk , payment , economics , marketing , ecology , biology , computer science , macroeconomics , operating system
This paper aims to investigate the association between perceived production risk of horticultural farms and access to finance from different finance providers. The collection of data was conducted among 434 farmers in Indonesia particularly farmers produced mango, mangosteen, chili and red onion. Production risk was measured by the coefficient of variation, skewness, kurtosis and the 25 th percentile. Depending on the risk measure, a lower production risk was found for commercial credit from banks and flexible payments of inputs to kiosks. Conversely, we did not find any lower production risk associated with finance provided by farmers’ associations and other sources such as family and friends. Results of this study are useful for policy makers, finance providers and supply chain actors in agriculture. For policy makers, the results of this study can help in designing policy to enhance farmers’ access to finance, whereas finance providers and supply chain actors, such as traders, obtain insight into whether their financial provisions effectively reduce production risk.