Determinants of loan repayment patterns among Micro Agricultural Financial Institution of South Africa beneficiaries in North West Province, South Africa

This paper examined the determinants of loan repayment patterns among Micro Agricultural Financial Institution of South Africa beneficiaries in North West Province, South Africa. A simple random sampling technique was used to select 273 respondents from a total of 344 beneficiaries. A structured questionnaire was used to collect data which was analysed using the Statistical Package for Social Sciences (SPSS) with frequencies, percentages and probit regression. The results show that respondents were predominantly male (84%); married (95%); Christians (94%); having secondary school education (72%) with a mean age of 55.5 years, mean production expenditure of R1251.43, mean personal expenditure of R 1168.50; mean income from livestock as R 121333.00 and mean income from crops as R 19468.00. In terms of repayment 29.3% did not repay, 44% made partial repayment and 26.7% total repayment. Significant determinants of no repayment pattern were natural capital after (t = 2.08), gender (t = 1.84), marital status (t = -2.26), membership of organisation (t = -2.31) while the significant determinants of partial repayment were farm expense (t = 3.80) gender (t = -2.07) age (t = 2.33), membership of organisation (t = -3.04), frequency of contacts with extension (t = -5.16). The significant determinants of total repayment were human capital after (t = 1.85), gender (t = -2.92), marital status (t = -3.60), dependents (t = -3.78), males in household (t = 2.90), females in household (t = 3.63) and frequency of extension contact (t = -1.75).