Determinants of Farmers’ Access to Agricultural Credit from Commercial Banks: An Economic Analysis in Villupuram District of Tamil Nadu
1J. Kosalram* and 2C. Venkatesh**
1,2Department of Economics, Faculty of Arts, Annamalai University, Annamalai Nagar, Chidambaram – 608002 (India) Author for Correspondence : J. Kosalram Ph.D Research Scholar, Email: kosalram76@gmail.com Contact Details of Authors : 1*J. Kosalram – 8903763173 ORCID ID: https://orcid.org/0009-0002-5074-1002 2**C. Venkatesh – 9159697983 ORCID ID: https://orcid.org/0009-0001-6372-9064
ABSTRACT
Access to institutional agricultural credit is essential for improving farm productivity, supporting agricultural investment, and promoting rural economic development. This study examines the determinants influencing farmers’ access to agricultural credit from commercial banks in Villupuram District of Tamil Nadu. The research is based on primary data collected from 120 farmers during 2025–2026 using a structured questionnaire. A quantitative and analytical research design was adopted, and the data were analyzed using descriptive statistics, correlation analysis, multicollinearity diagnostics, and Binary Logistic Regression. The findings reveal that socio-economic factors such as education level, landholding size, annual farm income, and farming experience significantly influence farmers’ probability of obtaining agricultural credit. Institutional factors, including collateral availability and membership in farmer organizations, also positively affect credit accessibility. However, distance to the bank negatively influences farmers’ access to institutional credit. The hypothesis testing results confirm that socio-economic and institutional factors significantly determine farmers’ access to agricultural credit from commercial banks. The study highlights the importance of strengthening rural banking infrastructure, simplifying loan procedures, and promoting financial awareness to enhance farmers’ access to formal agricultural finance and support sustainable agricultural development.