<p>Climate-smart agriculture (CSA) is vital for boosting agricultural resilience in regions vulnerable to climate change. Nevertheless, its adoption among smallholder farmers remains limited due to financial barriers. This study investigates how access to microcredit influences CSA adoption and enhances tomato yields in Kenya’s Arid and Semi-Arid Lands, where climate variability and systemic poverty hinder productivity. Using household data from 470 smallholder tomato farmers, we applied a multivariate Probit model to identify factors affecting CSA adoption and an endogenous switching regression (ESR) to estimate yield effects. Findings show that age, education, social networks, and extension services significantly impact CSA uptake, while marital status, cooperative membership, and fertilizer use determine microcredit access. Importantly, 64% of households adopted at least two CSA practices, resulting in a maximum yield increase of 24.61%. These effects are driven by microcredit's dual role in removing financial barriers for initial CSA investments and supporting risk-sharing climate adaptation strategies. As climate shocks increase, the study suggests expanding community-based financial models such as Rotating Savings and Credit Associations (RuSACCOs) and Village Savings and Loan Associations (VSLAs), along with integrated tools such as peer-monitored credit systems and climate-indexed insurance. These mechanisms promote repayment discipline, reduce default risk, and provide buffers against shocks, thereby supporting sustainable CSA adoption. Policy efforts should focus on financial inclusion combined with climate-risk management tools to build resilient food systems and protect livelihoods in drought-prone areas.</p>