Financial Inclusion and Resilience Among Farmers in Rural Communities

Abstract

Farmers are among the underserved community and often face difficulties to accessing financial services which hinders their ability to improve productivity, manage risks, and achieve economic resilience in the long term. This study explores the financial inclusion among farmers in rural communities focusing on the challenges they encounter and their coping mechanisms to survive economic shocks and financial exclusion. This study used convergent parallel mixed-methods design, and data were collected across seven municipalities in Southern Palawan, Philippines with 369 farmers participants. The study determines the socio-economic profile of farmers in terms of educational attainment, training and seminars attended, average income per cropping, farm size, and financial services obtained. While majority of the farmers are in elementary and high school levels, they have varied income brackets along with their farm size and access to different financial services, such as loans and insurance. A significant portion of farmers reported utilizing financial services from microfinance companies and informal credit sources. Thus, challenges identified include limited access to financial resources, inadequate financial management skills, loan dependency worsened by misalignment with agricultural cycles, leaving farmers more susceptible. Farmers cope by relying on loans and credits sought after microfinance companies and informal financial providers, alternative income sources, and crop insurance. The study suggests a financial inclusion program to give farmers in rural areas better access to an affordable and quality financial services along with policies supporting sustainable agricultural practices and continuous financial education emphasizing practical approach.