The Problems Encountered and Recommendations on the Operation of a Credit Revolving Fund for Small Scale Fish Farmers

In August 1991, the Lake Basin Development Authority in collaboration with a UNDP/BSF/FAO project, launched a credit revolving fund for small fish farmers in Kenya. The details of this scheme are:

• Its main objective was to promote fish farming in the Lake Basin Region of Kenya by assisting small farmers in obtaining credit for expanding their fish culture activities;
• It was in three phases - loans in the first phase were in cash while in the next two phases they were in kind;
• It has, till date, recovered only 12.4% of the total loan disbursed to 386 small scale fish farmers. This is due to factors such as drought, rise in input costs and lack of training.

The paper suggests that the project has created awareness of the benefits of fish farming in non-traditional fish farming districts so it should be continued, and gives the following recommendations:

• Project and loan recovery be kept separate;
• Onus of repaying should be on the individual farmers;
• Future loans should be given only through fish farmers associations/groups.