Abstract:
Coffee is a significant cash crop in Uganda’s economy and village savings and loan associations (VSLAs) are self-managed community-based savings group that provide sustainable and affordable financial solutions to smallholder farmers. This study focuses on assessing the effect of VSLAs on the productivity of Arabica coffee among smallholders in Buyobo sub-county, Sironko District. A cross-sectional research design was used to collect both qualitative and quantitative data from 120 randomly selected respondents (80 male and 40 female). Descriptive statistics was generated from cleaned, coded and entered into Microsoft excel and analyzed using SPSS version 25. Results of this study show that few people participate in VSLAs (38.8%) and most people were not participants in VSLAs (74.2%). The study also revealed that among the people who participated in VSLAs (n=46), 71.1% mentioned the benefit they get from VSLAs as access to credit, 17.4 % got a benefit of savings and those who had a benefit of trainings in the group were (10.9%). This study indicated that n=46 who were in VSLAs, n=44 were able to access financial services from VSLAs (95.7%) and 4.3% were unable to access financial services from the VSLAs.
The findings from this study showed that among the n=44 who cultivated coffee and were in VSLAs, the majority used the finances got from VSLAs for coffee production (72.7%) and they majorly invested in purchase of farm inputs (78.1%), labour payment (3.1%) and also post-harvest handling (18.8%). In conclusion, it is perceived that those who were in VSLAs were able to access finances that help then to invest in their coffee hence increased production.
