Non-performance of financial contracts in agricultural lending: A case study from - Karnataka, India

Savitha, B and Kumar, Naveen (2016) Non-performance of financial contracts in agricultural lending: A case study from - Karnataka, India. Agricultural Finance Review, 76 (3). pp. 362-377. ISSN 00021466

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Abstract

Purpose – Evaluating a portfolio of agricultural loans has become an important issue in recent years primarily due to a large number of loan defaults. The purpose of this paper is to investigate the factors influencing credit repayment behavior of farmers in Karnataka. Design/methodology/approach – The study is based on secondary data of 590 farmers collected from a private bank in the state of Karnataka, India. Binary logistic regression and multinomial regression analysis was carried out to estimate the probability of non-payment of a loan. Findings – The results of the regression confirm a significant relationship between non-repayment of agricultural credit and characteristics of borrowers such as the age, years of banking relationship, yield of the crop, distance to bank branch, size and tenure of the loan, farm size and leverage and efficiency ratio

Item Type: Article
Uncontrolled Keywords: Agriculture, Credit risk, Multinomial logit, Non-performing assets, Probability of default, Quality
Subjects: Management > MIM Manipal
Depositing User: MIM User
Date Deposited: 02 Nov 2016 10:11
Last Modified: 02 Nov 2016 10:11
URI: http://eprints.manipal.edu/id/eprint/147448

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