Financial Inclusion for Farmers Through Appropriate Financing Products: Analytic Network Process Approach

Dika Megantara () and Anita Priantina ()
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Dika Megantara: PT BPRS Al Salaam Amal Salman
Anita Priantina: Institut Agama Islam Tazkia

Chapter Chapter 10 in Enhancing Financial Inclusion through Islamic Finance, Volume I, 2020, pp 193-219 from Palgrave Macmillan

Abstract: Abstract Food security is an issue worldwide, including in Indonesia a developing agricultural country. Yields from farming are deemed insignificant and take time. Farmers and land owners tend to sell their land for fast cash. Access to capital is also a major issue since crops, such as rice, mature in several months, which constrains the banking industry from financing farmers. Baitul Maal Wat Tamwill, Demak, Indonesia, offers a financing mode that accepts payment after harvest. This research analyzes benefit, opportunity, cost, and risk (BOCR) elements of product implementation. Analytic network process (ANP) is applied. All elements are observed from farmers’ perspective and the IFIs/BMT’s wide in-depth interviews. Results from pairwise comparisons indicate that the benefit and opportunity of this product have more significant weight compared to cost and risk elements. Alternative strategies for maximizing benefit and opportunity while minimizing cost and risk are proposed.

Keywords: Food security; Financing paid after harvest; Financial inclusion for farmers; IFIs/BMT; ANP-BOCR (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:pal:psibcp:978-3-030-39935-1_10

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DOI: 10.1007/978-3-030-39935-1_10

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