Credit Constraints and Institutional Fit in Zambian Agricultural SMEs: Evidence from Makalanguzu Market in Choma
DOI:
https://doi.org/10.59413/ajocs/v7.i5.21Keywords:
Agricultural SMES, Access to Finance, Institutional Fit, Market Infrastructure, Government Support, Mixed Methods, ZambiaAbstract
Purpose: This study examines how finance, regulation, market conditions, and government support shape agricultural small and medium enterprise growth at Makalanguzu Market in Choma, Zambia.
Design methodology approach: A convergent mixed-methods design combined 71 usable survey cases, ten completed stakeholder interviews, and policy document analysis. A parsimonious regression tested credit constraints, policy and regulatory barriers, and the interaction between government intervention and market challenges. Qualitative themes were integrated with the statistical results.
Findings: Credit constraints were negatively associated with growth (B = -0.312, p = 0.002), as were policy and regulatory barriers (B = -0.205, p = 0.015). Responsive government intervention showed a positive association (B = 0.187, p = 0.040), although this third result did not remain significant after Bonferroni correction. Interviews identified high interest rates, collateral demands, short repayment periods, weak sanitation, limited off-loading space, insecurity, drought and low awareness of empowerment programmes.
Research limitations implications: The cross-sectional, single-market design and inconsistencies in the source dissertation's response accounting require cautious interpretation and raw-data verification before submission.
Practical implications: Finance should match agricultural cash-flow cycles, while municipal levies should be linked to visible services, and district-level support should integrate credit, training, market infrastructure and follow-up mentoring.
Originality value: The article develops an Integrated Competitive Adaptation Model that explains SME growth as the product of resource access, institutional fit and entrepreneurial response in a rural market setting.
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Copyright (c) 2026 Ruth Musamba Phiri, Dr. Norman Kachamba (Author)
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