Financial Credit Research Articles

Firms' gender composition, loan collateral, and sustainable finance

This study evaluates gender gaps in the collateral requirements of bank loans using a sample of firms in Latin America. We measure firm-level gender composition through ownership and workforce, both of which are directly related to women's economic empowerment. Additionally, we evaluate the differences in the impacts of firms' gender composition on collateral borrowing between banks that adopt sustainable finance codes of conduct and those that do not. Our empirical findings indicate that female-dominant firms are less likely to be required to provide collateral for their bank loans, and when collateral is required, its value is relatively lower. However, banks adopting sustainable finance codes are not less likely to grant collateral loans to female-dominant firms; in fact, these banks even require greater collateral values from these firms. The implications derived from our empirical findings concern gender inequality in accessing financial credit in developing countries and underscore the need for designing sustainable finance codes that specifically consider and rectify the challenges faced by female-owned firms, especially by firms with a majority female workforce.

The Role of Sharia Financial Inclusion in MSME Development in Sumenep (Study at BPRS Bhakti Sumekar)

This research is intended to identify and evaluate the contribution of Sharia financial inclusion at Sharia People's Financing Bank Bhakti Sumekar to the development of MSMEs in Sumenep Regency with the dimensions of accessibility, use of products and services, and service quality. This study determined sample size followed the Roscoe formula. At least 40 MSMEs were customers of Sharia People's Financing Bank Bhakti Sumekar were obtained. To collect data, a combination of interview methods and questionnaire distribution were used. The data was analyzed using SPSS for instrument testing, descriptive statistics, multiple linear regression, classical assumption testing, and hypothesis testing. Results showed that simultaneously, the variables of accessibility, use of products and services, and service quality have a significant impact on the development of MSMEs. However, partial use of products and services does not have a big impact on the development of MSMEs. This is partly due to the limited public awareness regarding Sharia financing, as well as the frequent misuse of credit financing. The implications of this research can provide direct benefits of Islamic financial inclusion, such as easier access to financing, better financial management, and increased business capacity. This will ultimately contribute to improved MSME performance, regional economic growth, and community welfare.

Review of the Impact of ESG Disclosure on Corporate Commercial Credit Financing

ESG is an extension of the concept of green investment, reflecting the concept of sustainable development of enterprises. In order to deeply understand the impact of ESG on corporate trade credit financing, this paper takes the existing research theories of ESG and corporate trade credit financing as an example to study the development background, application prospect, disclosure significance, and existing problems of ESG. At present, the literature on the impact of ESG performance on trade credit financing mainly focuses on three aspects: environment, society, and management. This paper first introduces the development background and application prospect of ESG, then combs the existing research theories related to ESG and corporate commercial credit financing, and finally comprehensively analyzes the significance and existing problems of ESG disclosure in order to help future related research. The results show that the study of ESG is helpful in comprehensively analyzing its potential role in corporate trade credit financing and the current challenges. It is suggested that the research on the relationship between ESG and corporate trade credit financing should be further strengthened in the future to better promote the sustainable development of enterprises and the stability of financial markets.

Analisis Atas Prosedur Pembiayaan Kredit Pemilikan Rumah BTN Platinum

To facilitate its role as a fund distributor to the public, the bank has established credit financing procedures. With these procedures, the bank can process credit financing in a uniform, systematic manner, in accordance with government regulations and the bank's own policies. Credit financing procedures also help the bank assess the feasibility of potential debtors and reduce the risks associated with credit financing. This paper aims to understand the procedures for Home Ownership Loans (Kredit Pemilikan Rumah, KPR) at PT. Bank Tabungan Negara (Persero) Tbk and to determine the alignment of these procedures with general credit financing procedures. This research was conducted at the Bogor Branch Office of PT. Bank Tabungan Negara (Persero) Tbk. The results show that the Home Ownership Loan (KPR) procedures at PT. Bank Tabungan Negara (Persero) Tbk comply with the general Home Ownership Loan (KPR) financing procedures, although there are minor differences due to the specific regulations of PT. Bank Tabungan Negara (Persero) Tbk. The requirements and conditions set by PT. Bank Tabungan Negara (Persero) Tbk are still relatively light and easy to fulfill. However, there are some challenges in the financing procedures, such as system errors and data discrepancies between the information provided by potential debtors and the data available at the civil registry office (disdukcapil). Keywords: Procedures, Credit, Home Ownership Loans

The Tone of Earnings Communication Conferences and Trade Credit Financing of Listed Companies

Earnings communication conferences are a key channel for information disclosure in China, providing incremental information to the capital market. Using data from Chinese A-share listed firms from 2007 to 2021, this research reveals that management's tone at earnings communication conferences significantly promotes trade credit financing. Mechanism tests suggest that management's tone facilitates trade credit financing by enhancing information transparency. Further analyses demonstrate that the effect of the management's tone on promoting trade credit financing is more pronounced in firms facing higher market competition and receiving lower analyst attention.

CREDIT MANAGEMENT STRATEGY TO ENSURE THE FINANCIAL STABILITY OF PACKAGING INDUSTRY ENTERPRISES

The article examines the possibilities of increasing the efficiency of credit resource management to ensure the financial stability of enterprises in the packaging industry. It was found that in modern conditions, the study of the assessment of the financial stability of the enterprise was not of a comprehensive nature, but was based, mainly, on the use of the coefficient method, which took place on a static basis and did not take into account the specifics of the industry, did not make it possible to assess the ability of the enterprise to generate cash flows for the implementation of activities. It has been proven that the problem of ensuring financial stability and financial balance of packaging industry enterprises is now an important one, especially in the conditions of uncertainty and instability of the economic environment caused by the war. On the basis of the conducted research, the key factors on which an effective credit management strategy should be based have been determined. In this context, the special importance of a timely and objective assessment of the financial stability of enterprises in the packaging industry, regardless of the forms of their ownership, is emphasized, which should be aimed at finding ways and opportunities to increase profits by means of a timely analysis of the financial state of enterprises. Eleven factors are proposed that should be taken into account when choosing a financial credit institution. A systematic analysis of the financial condition of the enterprise, its solvency, liquidity and financial stability is also necessary because the profitability of any enterprise largely depends on its solvency. Based on the balance sheet plan of the necessary resources, we forecast the sources of their formation, taking into account the level of financial leverage and the funds saved as a result of this at the time of taxation. Choosing the most profitable parameters, the enterprise can immediately determine the directions of saving its own monetary and financial resources, as well as optimize the use of already received ones. It has been established that in modern conditions, the relevance of effective financial management as a system of timely methods and techniques capable of preventing a financial crisis and avoiding risks of loss of financial stability of the enterprise in the future is objectively increasing. The lack of a clear definition of financial stability as an economic category and a system of indicators for its assessment, which requires further theoretical development of the problem.

Design of Blockchain and Strategic Financing Service under the Platform Economy

The capital constrains and uncertainties in supply disruptions faced by small and medium-sized suppliers pose critical challenges for the development of e-commerce platforms. In response, platforms have begun offering direct financing (PDF) to their suppliers alongside traditional bank credit financing (BCF). Within the private (consortium) blockchain, the platform and the supplier (and the bank) achieve consensus on financial smart contract, enabling the execution of flexible contracts tailored to suppliers’ risk profile. We develop a game-theoretic model to examine the terms of smart contracts in different blockchains and further investigate the platform's optimal blockchain design. We find that PDF serves to safeguard the platform's commission income from high-interest BCF. Our analysis reveals that PDF is more likely to be provided to a risky supplier within the consortium blockchain, contrasting with outcomes observed within the private blockchain. As a result, the platform and the supplier could reach win-win, or win-lose outcomes within the private blockchain; while within the consortium blockchain, they tend to result in win-win or lose-win outcomes. Such incentive conflict could potentially hinder blockchain adoption. Our findings further provide the managerial insights guiding the platform's blockchain design: adopting consortium blockchain under moderate market potential and low or high supplier's risk, and adopting private blockchain otherwise. Furthermore, we consider the supplier's endogenous effort on reducing risk, and numerically demonstrate that blockchain may encourage or discourage the supplier's effort. Our research complements previous studies by investigating the interaction between the PDF provision and blockchain structures under uncertain supply disruption risk.

On the empirical nexus of agricultural credit facility scheme and agricultural output dynamics in Uganda

The role of the agricultural sector in economic growth cannot be overemphasized. Agriculture is basically one of the key sub-sectors that enhance economic growth in all economies of the world. Since no sector of the economy can grow without enough capital, agricultural credit is considered as imperative for improved agricultural output. To contribute to knowledge in this regard, this study examined the impact of agricultural credit fund (ACF) on agricultural output in Uganda using quarterly data from 2009 to 2021. By employing the Autoregressive Distributed Lag (ARDL) framework, the results revealed that ACF has no significant effect on agricultural output in Uganda in the short run, but it significantly has positive effect on the sector in the long run. We control for economic growth, proxied by gross domestic product (GDP), interest, inflation, and exchange rates and find that exiting level of GDP, spurred agricultural output, while the rate of interest and inflation retard agricultural productivity (output), especially in the long run in Uganda. We recommend that the government of Uganda needs to increase agricultural financing through the credit facility scheme for further productivity of the sector.

Do technology export regulations impact corporate trade credit financing? Evidence from China

Based on an exogenous shock—the 2008 revision of the Catalog of Technologies Prohibited and Restricted from Export in China—we use a difference-in-differences (DID) research design to examine the impact of technology export restrictions (TERs) on corporate trade credit financing. We document that TERs limit a firm's access to trade credit. Specifically, TERs reduce corporate trade credit by approximately 44 % compared with that of an average firm in the sample. Moreover, the negative impact is more pronounced for firms with high financial risk or high product risk. Additionally, our tests show that both upstream and downstream firms reduce their provision of trade credit to firms impacted by TERs. The results suggest that TERs add trade barriers between countries, resulting in restricted corporate trade credit financing.

PRIORITY DIRECTIONS OF ENTERPRISES DEVELOPMENT IN THE WAR CONDITIONS BASED ON THE IMPLEMENTATION OF INFORMATION TECHNOLOGIES AND DIGITAL TOOLS

The article examines the modern challenges faced by Ukrainian enterprises in war conditions and the strategic approaches to adapting to these challenges. As business leaders, policymakers, and analysts, your understanding and support are crucial. The current stage of Ukraine's economic development, characterized by high instability due to the full-scale invasion of Russia, dictates new conditions for the functioning of domestic enterprises. In these conditions, implementing information technologies and digital tools becomes critically important for ensuring sustainable development and adaptation of enterprises to new realities. The influence of the war on the strategic behavior of enterprises is considered in detail, emphasizing the need to adapt to rapid changes in the external environment. In constant uncertainty and risks, enterprises are forced to look for new development opportunities, actively implement information technologies, and diversify their activities. The main challenges and barriers faced by enterprises during the war are also analyzed. Among them are the lack of sufficient capital, limited access to credit funds, the unpredictability of the situation in Ukraine, the negative impact of government decisions on business, and others. To overcome these problems, enterprises must look for development directions and develop appropriate development strategies that consider internal opportunities and external threats. Digitization and the use of information technologies are becoming critical tools for achieving these goals, allowing enterprises to adapt to changes in the external environment quickly, increase the efficiency of their activities, and maintain competitiveness. Special attention is paid to such promising development directions as DefenseTech, FinTech and cyber security. These directions, with their significant potential for development in wartime, provide the necessary technological solutions to improve the security and efficiency of enterprises, offering a beacon of hope for the future. Thus, the article provides a comprehensive analysis of the priority directions of enterprise development in wartime conditions, with an emphasis on implementing information technologies and digital tools.

The Impact of Financial Development on Unemployment: The Case of the People’s Republic of China (PRC)

Research Originality: As a populous country with a population of 1.4 billion, China faces the imperative issue of employment. This paper focuses on the impact of financial credit and financial deposits on different levels of unemployment in an attempt to analyse the unemployment problem in China.Research Objectives: The paper explores the impact of financial development on unemployment in China.Research Methods: Using panel data from 31 provinces and cities in China (spanning from 2007 to 2021), categorizing unemployment situations, employing quantile regression models to assess the impact of financial development on different levels of unemployment in China.Empirical Results: The findings indicate a negative correlation between financial development and unemployment levels in China. The study reveals that financial credit significantly impacts unemployment in provinces where the economy is higher than average GDP. However, in regions where the economy is lower than average GDP, the impact of financial deposits on unemployment is significant.Implications: This study establishes that the adoption of financial expansionary policies by the government can reduce unemployment and help guide the formulation of more precise and effective economic policies.JEL Classification: G21, E24, C33, O53How to Cite:Yixin, L., Radzi, N.A.M., Ma, M., & Saidi, N.A., (2024). The Impact of Financial Development on Unemployment: The Case of the People’s Republic of China (PRC). Etikonomi, 23(2), 353 – 368. https://doi.org/10.15408/etk.v23i2.37997.

Optimal ordering strategy for deteriorating items with maximum lifetime using trade credit financing under imprecise environments

In many business scenarios, a retailer is permitted specific credit period to pay back for the products bought earlier. This facility enables retailers to continue their business operations even when they are unable to raise funds or secure a business loan. To boost the market's demand, promotional effort is a very effective business strategy to the retailer for maximizing the profit. On the other hand, a sudden and significant rise in customer demand for an inventory leads to shortages. Moreover, inventory relevant unit cost coefficients become imprecise due to insufficient data, human error etc. Nowadays, neutrosophic set quantifies the impreciseness more realistically. Considering these facts, an imprecise EOQ model for deteriorating items with maximum lifetime is formulated under trade credit facility. In addition, this article allows shortages, which are linearly time-dependent partially back-logged. Here, the unit cost coefficients are expressed as single-valued trapezoidal neutrosophic numbers. Furthermore, particular models are derived under different environments - intuitionistic, fuzzy, and crisp. Step-by-step solution procedures are suggested for all models to obtain optimal solutions. Models are numerically illustrated with real-life data, and some sensitivity analyses are performed. Managerial insights demonstrate that depletion time always depends on demand. Again, the present study suggests to reduce demand by halting the promotional activities during the shortage period and choose products with a larger lifetime.

Channel and pricing strategies in a risk-averse dual-channel supply chain: portfolio trade credit financing and platform investment

ABSTRACT This paper considers a dual-channel supply chain where the supplier can distribute products through an online platform and a capital-constrained traditional offline retailer. The retailer needs to fund its business by a portfolio financing of trade credit and platform investment to enter the market. With the price-dependent market uncertain demand, the supplier faces choices among direct, traditional, and dual channels for product distribution. We use the CVaR criterion to formulate the retailer’s risk-averse behaviour. Then derive the optimal retail channel strategy in a Stackelberg game model where the platform leads by setting a revenue-sharing rate. Our results unveil a Pareto improvement region in revenue sharing rates within the portfolio financing scheme. As the slotting fee escalates, the supplier tends towards traditional channels. Conversely, with a modest slotting fee, a threshold emerges for the retailer’s risk aversion, delineating the optimal retail channel. High retailer risk aversion favours the dual channel, while lower aversion steers all members towards the direct channel. Theoretical findings are validated through numerical analysis.

Corporate social responsibility on trade credit financing capacity: Facilitation or inhibition?

Corporate social responsibility and trade credit financing are increasingly emphasized by investors and management. Using data from Chinese A-share private listed companies from 2010 to 2021, this paper finds that CSR practices significantly enhance trade credit financing capacity, with this effect being more pronounced in enterprises located in regions with favorable commercial credit environments and samples of firms with high-quality disclosure. Furthermore, we identify three potential mechanisms: improving internal control quality, reducing operational risk, and enhancing supplier relationship stability. The findings underscore the important role of CSR in improving corporate financing ability and provide valuable insights for management practices.

PENGARUH PEMBIAYAAN KREDIT USAHA RAKYAT TERHADAP PENDAPATAN USAHA MIKRO KECIL DAN MENENGAH DI PT. PEGADAIAN SYARI’AH UNIT KARANG BARU

This research aims to find out how the People's Business Credit (KUR) financing process is carried out by PT. Pegadaian Sharia Unit Karang Baru and how much influence People's Business Credit (KUR) financing has on the income of Micro, Small and Medium Enterprises (MSMEs) partially. The type of research used is field research with a quantitative approach. The population used in this research were 229 customers of the PT. Sharia Pegadaian Karang Baru Unit. The sample was selected using the incidental sampling method and calculated using the Slovin formula as many as 70 respondents. The data used in this research is primary data obtained from respondents who filled out the questionnaire. The results of this research show that people's business credit financing obtained a t count value of 15.175 and a t table of 1.66757 with a significant value of 0.000 at a significance level of 0.05. Based on these results it can be seen that t count > t table where 15.175 > 1.66757 and a significant value where 0.000 < 0.05 which means that Ho is rejected and Ha is accepted, so it can be said that the KUR financing variable (X) partially has a positive and significant effect on the income of MSME (Y) customers of PT. Pegadaian Sharia Unit Karang Baru

Analisis Penerimaan Dana Kredit Usaha Rakyat (KUR) Pada UMKM pada PT. Bank BRI Unit Tapa Kota Gorontalo

This research aims to find out whether there is an impact on providing people's business credit (KUR) to MSMEs at PT. Bank Rakyat Indonesia (Persero) Tbk. Tapa Unit Gorontalo Branch Office. This research uses qualitative methods with the data sources used, namely primary and secondary data. The data collection techniques used were observation, interviews and documentation. The object of this research is an analysis of the provision of people's business credit (KUR) funds to PT. BRI bank unit tapa Gorontalo city. The results of the research show that there is an assessment of the character of prospective customers at Bank BRI Tapa unit which is intended to determine the candidate's honesty and good faith in paying off or returning the loan, so that it will not cause difficulties for the bank in the future. The relationship between credit giver and credit recipient is a mutually beneficial cooperative relationship with the credit giver's trust in the credit recipient based on the credit recipient's credit rating. The procedures for granting and assessing credit by the banking world between the BRI Tapa unit and other banks are not much different. The difference may only lie in the procedures and requirements established with individual considerations. Settlement of bad debts in KUR credit at Bank BRI Unit cannot be resolved non-litigationally because Kur itself is a program from the government to make it easier for people who want to do business.

Research on the Impact of Digital Inclusive Finance on Rural Economic Development

Digital technology significantly enhances the efficiency, user experience, coverage, and accessibility of financial services. It effectively addresses the issue of imbalanced and inadequate financial services, provides strong support for the advancement of inclusive finance, and facilitates high-quality development of the real economy. Currently, rural rejuvenation and digital inclusive finance are two prominent topics in China. The objective of this article is to identify and address issues by examining the correlation between digital inclusive finance credit and the rural economy. This paper employs a fixed effects model to examine the correlation between digital inclusive financial credit business and the additional value generated by the primary industry. The results indicate a strong negative association between the digital inclusive financial lending business and the added value of the primary industry. The government should prioritize the simultaneous progress of digitalization and finance in rural areas in order to establish a more comprehensive rural economic and financial system.

Analysis Of Home Ownership Credit (KPR) Financing Flpp Prosperity For Customers Low Income (Case Study of Bank BJB Medan Branch Office)

This research aims to evaluate the effectiveness of Sejahtera Home Ownership Credit (KPR) financing through the Housing Financing Liquidity Facility (FLPP) scheme implemented by Bank BJB for Low Income Communities (MBR). The research method used is descriptive qualitative with data collection through in-depth interviews, observation and documentation analysis. The research results show that the FLPP Prosperous KPR program run by Bank BJB has a high level of effectiveness in helping MBR have livable houses. This effectiveness is supported by several factors, including easy access to financing with low interest rates and flexible terms, significant government subsidy support, increasing the welfare of MBR through home ownership, Bank BJB's active role in socialization and education, high levels of realization and customer satisfaction. , as well as good collaboration with developers. With this achievement, the FLPP Prosperous KPR program is proven to be able to provide more affordable financing solutions and contribute to improving the quality of life for MBR. It is hoped that the results of this research can become a reference for developing more inclusive and sustainable banking policies.

An Investigation into the Impact of Interest Rate Fluctuations by Financial Lending Institutions on Small and Medium Enterprises’ (SMEs’) Loan Repayment among Selected Lusaka-Based Firms

This study purposed to investigate the impact of interest rate fluctuations by financial lending institutions on small medium enterprises’ (SMEs’) loan repayment Among selected Lusaka based SMEs. The issue of high interest rates charged by financial institutions is a significant concern for SMEs in Zambia. The study was guided by three research objectives; to examine the challenges SMEs face in repaying financial credit gotten from financial lending institutions; to find out the effect of interest rate fluctuations on loan repayment among SMEs operating in Lusaka City and to propose a policy framework amenable for stable and affordable interest rate by financial lending institutions operating in Lusaka City. The target population for this research was one hundred (100) SMEs registered and operating in Chilenje market in Lusaka city. This study employed a descriptive design and a mixed-method approach, combining qualitative and quantitative data collection to leverage the strengths of both methodologies. The research population was well-defined and complete for simple random and purposive sampling methods. The research paradigm was rooted in pragmatism, focusing on empirical data to explore the relationship between interest rate fluctuations and SME loan repayment behavior in Lusaka, using a sample size of 53 SMEs from Chilenje market. Data collection involved administering questionnaires with both open and closed-ended questions and interview schedules. This research study successfully established the effect of interest rate fluctuations on loan acquisitions among SMEs operating in Lusaka city. It demonstrated that SMEs are sensitive to changes in interest rates, with the majority indicating that their decision on loan acquisitions is affected by fluctuating interest rates. This underscores the importance of interest rate stability for SMEs in making informed borrowing decisions and managing financial risks. The study advocates for a framework which promotes transparency and market efficiency, implementing regulatory measures to mitigate risk and encourage competition, and facilitating access to credit information and alternative financing options. By comparing these findings with existing research, the study underscores the complex nature of SME loan repayment behaviors in response to interest rate fluctuations and emphasizes the need for collaborative efforts among policymakers, financial institutions, and SME stakeholders to address challenges and promote sustainable growth within the SME sector.

Debt Levels and Their Effect on The Profitability of Banking Firms at The Indonesia Stock Exchange

This study aims to determine the impact of debt levels on the profitability of banking companies listed on the Indonesia Stock Exchange. The research focuses on two variables: the Debt-to-Equity Ratio (DER) and Return on Assets (ROA). Quantitative research with simple linear regression analysis is a type of study aimed at understanding the relationship between two variables. The population of this study includes 47 banking companies listed on the Indonesia Stock Exchange (IDX), from which a sample of 4 banking companies was selected using purposive sampling. This qualitative research employs simple linear analysis using SPSS 25.0 as the analytical tool. The results, based on significant values and partial values, indicate that an increase in debt levels among banking companies listed on the Indonesia Stock Exchange leads to a decrease in profitability. This is because the debt of banking companies is not solely used for operational activities but also for providing credit funds to customers