Credit access and perceived climate change resilience of smallholder farmers in semi-arid northern Ghana

While climate change is a global phenomenon, it has significantly stifled agricultural productivity in the Global South due to changes of key atmospheric elements including extreme temperatures and unpredictable rainfall over the last fifty years. According to the Intergovernmental Panel on Climate Change, in sub-Saharan Africa where rainfed agriculture is the dominant livelihood strategy, climate change is increasingly undermining rural livelihoods. Despite several policy efforts to improve climate adaptation in this context, smallholders’ lack of access to credit constitutes one of the crucial dimensions of climatic vulnerability. Using an ordered logistic regression model, this study analyzed data from a cross-sectional survey (n = 1,100) in the Upper West Region to examine the relationship between smallholder farmers’ access to credit and their perceived climate change resilience. Findings show that households with access to credit from informal sources were more likely (OR = 1.73, p ≤ 0.05) to report good resilience compared to those without access. Households that received remittances were also more likely (OR = 3.26, p ≤ 0.001) to report good resilience compared to non-receiving households. Further, households that did not rear any livestock surprisingly emerged more likely (OR = 2.00, p ≤ 0.001) to report good resilience compared to those that reared livestock. On the contrary, households that had experienced any climatic events in the past 12 months before the study were less likely (OR = 0.29, p ≤ 0.01) to report good resilience compared to households that did not experience any events. These findings highlight the potential contribution of informal credit sources to improving rural agricultural productivity and climate change resilience. Informal credit sources may be capable of providing smallholder farmers with the needed access to more flexible financial credit options. The study provides policy recommendations on what might be useful to vulnerable groups, and others in similar contexts.