Credit Granting Research Articles

Parties of the Shareholders’ Agreement

The author of the article has studied the problem of determining the subjective aspect of a shareholders’ agreement. On the basis of the analysis of the legislation of Ukraine and other countries, as well as the legal doctrine of corporate law, the author has concluded that exclusively shareholders of a particular company should be recognized as such persons, since they as the holders of subjective corporate rights, have the opportunity to exercise them in the manner determined by such an agreement.
 Contracts between third-party entities and shareholders, where the latter undertake to exercise their corporate rights in shares, in accordance with the directions of third parties, can not be attributed to shareholders’ agreements because the subject matter and purpose of such agreements and shareholders’ agreements do not coincide. Accordingly, a joint-stock company and third parties (its credit grantors, persons who did not acquire shareholder’s status because of various reasons and other persons) can not be recognized as a party to such an agreement, since they are not holders of corporate rights.
 The parties to a shareholders’ agreement conclude it because of corporate capacity, which is specific, characteristic for them as members of the joint-stock company. A shareholders’ agreement is an act of corporate legal capacity embodied in a contractual form. Therefore, only shareholders of a particular joint-stock company can conclude such an agreement. Contractual relationships are terminated in terms if one of the parties loses the respective obligation of such legal capacity, while the agreement itself remains valid for the parties that have retained the corporate legal capacity, unless otherwise expressly provided by it.

Intelligent credit scoring system using knowledge management

Promoting entrepreneurship in Morocco among young people has been a challenge for some years of economic and social problems, especially after the events of the Arab Spring. Several programs have been set up by the government for young entrepreneurs. Thus, faced with the large number of credit applications solicited by these young entrepreneurs, banks are obliged to resort to artificial intelligence techniques. For this purpose, the aim of this article is to propose a decision-making system enabling the bank to automate its credit granting process. It is a tool that allows the bank, in the first instance, to select promising projects through a scoring approach adapted to this segment of young entrepreneurs. In a second step, the tool allows the setting of the maximum credit amount to be allocated to the selected project. Finally, based on the knowledge of the bank's experts, the tool proposes a breakdown of the amount granted by the bank into several products adapted to the needs of the entrepreneur.

Credit Scoring for Financial Services Institution using Ant Colony Optimization Algorithm under Logistic Regression Model

Economic and trade activities are important in a country. All these activities are regulated by financial institutions, such as banks. The process of channeling funds to the public or known as credit is one of the tasks of the banking sector which aims to improve the people's economy. Credit granting is required for credit analysis, which is useful to determine the level of eligibility of a debtor to receive credit. The function of the credit analysis is to reduce the credit risk of prospective debtors who have failed to pay as well as to avoid financial institution losses or charges. The method used to analyze credit risk in this study is the Ant Colony Optimization algorithm in the Logistic Regression model. Past data held by each prospective debtor obtained from one financial institution in Indonesia is used as a feasibility parameter in this analysis. The results of the study showed that eight variables analyzed were five variables including the significant influence (age of debt ( X1 ), family dependents ( X 2 ), value of the collection ( X 4 ), the number of credit limits ( X 6 ), and the term of the loan ( X8 ) while the other three variables (the amount of savings ( X 3 ), income per month ( X 5 ), net income ( X 7 ) are not significant to the risk of default.

Racikan Strategi Pemberian Kredit di Bank Perkreditan Rakyat

ABSTRACTAlong with the decline in interest rates given while the interest rates of third party funds did not experience a decline from the previous year. This indicates that there is an inverse comparison between the savings interest rate and the loan interest rate, where the comparison should be directly proportional to the interest rate of the savings and the interest rate on the loan. This research was conducted at PT. BPR. Balaguna Perasta, whose address is batutabih no. 99x Klungkung District, Klungkung Regency, Bali Province. The reason for conducting research is because of the level of competition in tight lending rates in line with the reduction in LPS (Deposit Insurance Corporation) interest rates, besides that this research was conducted because of the loan interest rates given by PT. BPR Balaguna Perasta is smaller than the average market interest rate. Data type consists of quantitative data and qualitative data collected from primary and secondary data, through data collection techniques, documentation and interview studies to 3 informants, and data validity testing techniques using triangulation with sources and using quantitative and qualitative analysis techniques. With the calculation of the average interest rate on BPR loans in Klungkung Regency at 21.6% pa, the channeling of loans provides an average loan interest rate of 19.1% pa (according to the 2018 financial report), and based on the calculation of the base landing rate above is obtained at 20.77%, so the interest rate determination made by the Rural Credit Bank (BPR) Balaguna Perasta in Klungkung Regency is not yet ideal. In giving and lending to banks, it is always based on the rules / procedures for granting credit by applying the precautionary principle. Especially, it has applied the 5'C principle which includes analysis of character, capacity, capital, collateral, condition of economic in addition to the procedure of lending in accordance with Bank Indonesia regulations, namely credit application requirements, credit granting limits, loan interest rates, and all sanctions in accordance with regulations specified. So that the Interest Rate Determination Strategy for increasing credit sales in the Balaguna Perasta Rural Credit Bank (BPR) in Klungkung Regency does not affect much in the provision of security/ineffectiveness.

The VAT Conundrum of Fuel Cards: Thoughts on the ECJ Judgment in Vega International

The ECJ’s judgment in Vega International has created a wave of controversy amongst VAT practitioners. The ECJ concluded that when a parent company provides fuel cards to its subsidiaries, enabling those subsidiaries to refuel the vehicles they transport at petrol stations, the parent company is not, for VAT purposes, the recipient of the fuel deliveries made by the service stations, nor is that company delivering fuel to its subsidiaries. On the contrary, the parent company is, for VAT purposes, providing services to the subsidiaries comparable to the granting of credit, which is exempt from VAT. In this article, the authors’ objective is to extrapolate the conclusions of this decision to other cases and explain how the usage of fuel cards operates in the market.

Pembangunan Sistem Informasi Pemberian Kredit Pada Koperasi Mekarsari Dengan Metode Rapid Application Development

The cooperative is a business entity that is very well known by pro people, because the cooperative is group of individuals who run its business based on family principle, Pancasila and the Undang-Undang 1945. The cooperatives development in Indonesia indicates a positive trend and known by the public. One of them is Cooperative Mekarsari. This filled Mekarsari cooperative is getting better every day. Cooperative Mekarsari provided many services to members, one of them is about the granting of credit or loans. Granting of credit given is usually devoted to the retirement, although not close the possibility of members who are not retired can ask loan. However, data processing in granting credit Cooperative Mekarsari is still done manually, giving rise to some problems, such as the granting of credit or loans still recorded using handwritten into the book loans, still merge the recording of data between loan and installment, there is no limitation work space that allows the data become no secret. By looking at it, then this requires the existence of a Cooperative system to facilitate development in the processing of the data and provide services to its members. And to assist in the process of developing such a system, it is necessary to use an appropriate method, i.e. the Rapid Application Development method. The expected results of this form system development, program application is expected to resolve the existing problems in Cooperative Mekarsari. Keywords: program application, cooperation, RAD , loan

A Simplified Interval Type-2 Fuzzy Implementation for Financial Credit Decision

Credit assessment of potential customers with the help of their previous history of credit transaction is one of the main issues in financial credit approval system. The credit rating of the customer shows that the financial stability of the individual or firm. Based on financial stability, the bankers can approve their credit grant. The basic factors that affect the credit rating of the customer is history of payment, the unsettled amount, period of credit history, types of credit and many other factors. The creditworthiness of the customer is assessing based on result obtained from these factors. The prime objective of the credit approval system is to avoid loss of amount that may be associated with an incorrect decision. To avoid such type of decisions, it requires designing of credit rating models for credit and their risk analysis. This type of models benefited the bankers to approve the credit grant or not. The bank credit system is a binary classification system that classifies the customer either the good or bad based on their previous credit history. In this context, several fuzzy classification systems have been designed to classify the customer. In this article, we have designed a simplified interval type-2 fuzzy system for financial credit decision using two different membership function based approaches and compared the performance in terms of accuracy of classification.

Bank Lending, Financial Frictions, and Inside Money Creation

I build a general equilibrium model of the transmission of monetary policy on bank lending. Bank lending is done by individual banks that face random investment opportunities by creating inside money. Banks are subject to a reserve requirement and have access to the interbank money market. The model shows that lowering the money market rate relative to the inflation rate reduces investment and welfare. This is because the money market is an outside option for banks that face bad investment opportunities. Reducing the money market rate lowers the value of this outside option, which in turn reduces banks’ willingness to acquire reserves ex-ante. This leads to less aggregate reserves, which reduces the banking system’s ability to grant credit.

Street time is no sweet time: granting credit for time on parole in Australia

ABSTRACTThis article examines how time spent on parole, commonly known as ‘street time’, is dealt with where a parolee breaches their parole. In some jurisdictions, street time is credited as time served, in some it is forfeited and, in others, parole authorities have discretion whether to grant credit. This article examines Australian laws regarding credit for street time, presents the data available, and considers the rationale for and against crediting street time. We argue that it is appropriate to recognise time spent under sentence in the community in the event of any subsequent breach, as this recognises (imperfect) progress, rather than promoting an all-or-nothing compliance-focused model of parole.

ANALYSIS FOR THE PURPOSE OF CREDIT

This topic addresses the financial analysis of a business for lending purposes. Often a business is analyzed as a potential borrower. The lending activity by the financial institutions is complex and in itself contains other elements besides the sound analysis of the financial statements. These other elements are: recognition of the applicant's activity for the loan or its past repayment. The handling of many elements will help the analysts with the purpose of lending. The analysis of financial assets is done by banks, credit analysts for credit granting. The financial statements and the analysis of financial indicators in an enterprise is carried out to make decisions. The analysis of financial statements and financial indicators is carried out to assist in providing reports, explanations to make a decision about the enterprise, whether it is worthwhile to acquire the shares of the enterprise, whether it is a credible creditor, if the investment in the bonds society is most valuable. The following issues will be addressed in this topic. Interpretation of Balance Sheet for lending purposes, analysis of short-term assets and working capital, valuation of inventories in the balance sheet, their importance in the lending process, Interpretation of the size of the receivables and the accounts payable and Interpretation of the Statement of Income for Loan Purposes.

Credit Line Models for Supply Chain Enterprises with Channel Background and Soft Information

Credit lines have been widely adopted by banks to grant credit to small and medium-sized enterprises (SMEs). However, there often exists a gap between the credit lines granted by banks and the actual funding needs of SMEs. In addition, existing credit line models treat each SME as a stand-alone entity instead of considering it within its supply chain system. But an SME’s supply chain relations have a significant impact on its credit-worthiness. To offer banks a holistic assessment, this paper first constructs a base credit line model for SMEs by considering their supply chain background. Next, by accounting for the unique advantage of soft information processing in a supply chain context, we put forward an extended credit line model for supply chain enterprises with soft information. The base and extended credit line models proposed in this paper aim to reduce information asymmetry between banks and SMEs via the core enterprise in the supply chain, thereby helping banks to secure a sustainable source of profit at a lower risk level and SMEs to obtain more credit to support their sustainable growth. A case study is furnished to illustrate how the proposed models can be applied in practice and an empirical analysis further verifies their validity.

Problems of NPA in Banking Sector in India & Debt Recovery Remedies

The issue of Non Performing Assets has been discussed at length for financial system all over the world. The problem of NPAs is not only affecting the banks but also the whole economy. In fact level of NPAs in Indian banks is nothing but a reflection of the state of health of the industry and trade. Granting of credit for economic activities is the prime duty of banking. Apart from raising resources through fresh deposits, borrowings and recycling of funds received back from borrowers constitute a major part of funding credit dispensation activity. Lending is generally encouraged because it has the effect of funds being transferred from the system to productive purposes, which results into economic growth. However, lending also carries a risk called credit risk, which arises from the failure of borrower. Non-recovery of loans along with interest forms a major hurdle in the process of credit cycle. These loans affect the bank’s profitability on a large scale. The rising NPA has had posed a great challenge on the survival of Banking Industry in India and with this tenuous Banking Industry smitten with NPA, our desire to become an economic superpower would just be a daydream, thus, recent steps taken by RBI and Government of India to mitigate the deleterious effect of NPA has been discussed in this paper.

Evaluasi terhadap Sistem Pengendalian Intern pada Proses Pemberian Kredit Mikro Koperasi Simpan Pinjam (KSP)

Cooperative is a joint business entity engaged in the economy, consisting of those who berekotakan weak voluntarily joined and the equality of rights, is obliged to undertake a business that aims to meet the needs - the integrity of its members. Cooperative Artha Makmur is a keuhangan institution that collects funds from the community in the form of savings and menyerhkannya back in the form of credit. In the implementation of the provision of microcredit, the risk of credit congestion is a problem that is often faced by co-operatives and negatively affect the cooperative one of them inhibit the rate of credit turnover and disrupt the performance of management. Bad credit itself occurs due to too lax lending and internal control system is also still not in accordance with the theory and has not been implemented optimally. Therefore the authors took the initiative to evaluate the internal control system of credit giving to the cooperative Artha Makmur. The evaluation result shows that the system applied in the crediting process has largely fulfilled the elements of internal control, although there are still weaknesses, namely the Internal Control System in the Artha Makmur cooperative has not been evident so that in the fear of loss caused by the weak credit quality. In addition, on the spot implementation is done, not in accordance with the manual procedure of microcredit products.
 Keywords: Internal Control System, Cooperative, Credit Granting

La Gestión de Créditos y Cobranzas Caso Empresa “Multillanta Ramírez”

La presente investigación tuvo como objetivo principal la evaluación del sistema de control interno a la gestión de créditos y cobranzas de la empresa Multillanta Ramírez, para lo cual se plantearon cuatro objetivos específicos: como primer objetivo se levantó información respecto a la situación actual de la empresa mediante el uso de técnicas de recolección de datos, donde se trató temas como: estructura organizacional, políticas y procedimientos actuales de la empresa con respecto al área en estudio. En el segundo objetivo se determinó el nivel de riesgo y de confianza con la aplicación del cuestionario de control interno COSO ERM donde se estableció una matriz de recomendaciones con los componentes que presentan riesgo en la empresa. Como tercer objetivo se aplicó técnicas e instrumentos de auditoría para verificar el cumplimiento de políticas y procedimientos establecidos en la empresa. Finalmente, en el cuarto objetivo se elaboró un informe de auditoría, el mismo contempla las conclusiones y recomendaciones para la mejora de la gestión de créditos y cobranzas, el mismo que se ajusta a las Normas de Auditoría Generalmente Aceptadas para emitir una información suficiente y competente.

Estimating farm-level financing gap: a technical efficiency approach

PurposeMuch attention has been paid to farm credit access with less focus on determining the actual credit amount needed to bring about a specified increase in productivity relative to the finance being sought. The paper aims to discuss this issue.Design/methodology/approachUsing 2016 cross-sectional data of plantain farmers, the authors employ the Cobb–Douglas stochastic frontier production function to determine the technical efficiency (TE) of each farmer. Current plantain quantity produced by farmers and the TE are then used to estimate plantain quantity at a target efficiency. The finance needed to produce at the target efficiency is estimated using the Harrod–Domar (HD) growth equation and the authors then subtract the farmers’ savings from the estimated amount to determine the financing gap of the farmers.FindingsResults of this study show that the actual amount required to improve the productivity of farmers to target levels of TE can be estimated and that credit amount granted to farmers can be tied to a specific production efficiency. Credit schemes with interest rates below 9 per cent are more beneficial to farmers while access to credit is determined by interest rate, education, credit process duration, land ownership and asset value in the study area.Research limitations/implicationsThe implication of this research is that it opens up the possibility of further exploring the application of the HD theory at the micro level.Practical implicationsThe findings in this study have important implications on the provision of agricultural credit to small farmers. The first is that the TE of farmers plays a very critical role in determining the actual amount of credit needed to bridge the farm-level financing gap and impact positively on productivity. Second, while it is important to bridge the farm-level financing gap, this can only be beneficial to the farmers at single-digit interest rates below 7 per cent. Finally, granting of credit to farmers can be tied to specific production increase target to reduce indiscipline and mismanagement in credit use.Social implicationsThe findings of this study will go along in helping to prevent mismanagement and indiscipline in the use of scarce financial resources in agricultural production.Originality/valueThis study is the first of its kind, using TE and bringing the HD equation down to the farm level to estimate the exact amount required by farmers to bring about specific increase in production, determining the credit amount beyond which mismanagement may set in.

Credit Scoring: A Review on Support Vector Machines and Metaheuristic Approaches

Development of credit scoring models is important for financial institutions to identify defaulters and nondefaulters when making credit granting decisions. In recent years, artificial intelligence (AI) techniques have shown successful performance in credit scoring. Support Vector Machines and metaheuristic approaches have constantly received attention from researchers in establishing new credit models. In this paper, two AI techniques are reviewed with detailed discussions on credit scoring models built from both methods since 1997 to 2018. The main discussions are based on two main aspects which are model type with issues addressed and assessment procedures. Then, together with the compilation of past experiments results on common datasets, hybrid modelling is the state-of-the-art approach for both methods. Some possible research gaps for future research are identified.

Efektivitas Pengendalian Internal Pemberian Kredit Studi Kasus pada PT. Bank Bri (Persero) Tbk Unit Daeng Sirua Makassar

Internal control is, a system of procedures that can automatically check each other recording between parts or functions within an organization and prioritize accuracy and administrative. Usually this is done by employing two or more people independently, to obtain the same numer or the same result. Granting of credit, is a general procedure of credit regarding the terms, conditions or guidance of actions to e performed since the sumission of credit application by the customer until the paying off a credit y the bank.The title of this research is: Effectiveness of internal control of lending (case study at PT Bank BRI Daeng Sirua Makassar).As for the problem studied by the author is whether the internal control of credit extended by Bank BRI (Persero) Tbk Unit Daeng Sirua has been effective.This research uses descriptive qualitative with case study approach, with carat question and answer. The conclusion is obtained from the result of study, the effectiveness of internal control of the grant held by PT. Bank BRI Daeng Sirua Makassar in supporting the procedure of credit provision is quite effictive.

A group decision model for credit granting in the financial market

Group decision models that contemplate the particularities of the decision-making process help organizations pursue their strategic objectives. In the financial market, the primary interest of organizations consists in ensuring financial returns, which guarantee stability for the organization. This study identifies major problems in the current process of credit granting in the financial market and argues the need for automatizing the organizational decision process while respecting the autonomy of decision-makers. To this end, this study proposes a group decision model based on the Strategic Choice Approach (SCA) for granting credit in a financial market organization. The results show that the adoption of the proposed model offers considerable gains in terms of organizational goals, transparency of the decision-making process, security for decision-makers, and reduction of organizational conflicts.

Auditing and credit granting to SMEs: an integrative perceptual model

Purpose The purpose of this study is to develop an integrative model of credit granting to small- and medium-size enterprises (SMEs) incorporating the loan officers’ perceptual factors about SMEs (risk and trust) and accounting information (quality and usefulness). Moreover, the role of auditing on credit granting has been studied. Design/methodology/approach The structural equation modelling (SEM) approach is used to test the joint effect of explanatory variables. Empirical evidence is obtained from a questionnaire administered to 471 bank loan officers in Spain. The questions are asked for both audited and not-audited firms. Findings The results obtained confirm that perceived risk and trust have a significant influence on the probability that SMEs can get access to credit and obtain better financing conditions. Additionally, this research supports the relevance of presenting high-quality accounting information, as it increases information usefulness for loan officers, which improves the perceived risk and trust on SMEs and leads to better credit granting. There are no significant differences on the model between the sub-groups of audited and not-audited SMEs, although the valuations are significantly better for the former. Research limitations/implications This study shows the need to consider subjective variables to understand properly the cognitive process underlying credit-granting decisions. Practical implications This research has relevant implications for the management of relationships between SMEs and banks. Originality/value This study contributes to the previous literature by proposing an integrative model of the variables that affect loan officers’ lending decision to SMEs, considering the influence of perceptual variables such as risk and trust, as well as the evaluation of the information available.

Effects of Income and Fund Management of State Civil Apparatus on Bank Credit Granting (Case Study of the Academic Community of IAIN Manado)

AbstractThis study aims to examine and analyze the influence of income (x1), and the management of funds of the state civil apparatus (X2) on bank credit granting, a case study of the Academic Community of IAIN Manado. This research is a survey research conducted on the Academic Community of IAIN Manado. The population in this study is 111 respondents and the sample is 87 respondents. Sampling uses a random sampling technique with Solvin formula. The data analysis technique used in this study is the normality test, hypothesis testing, and T test using multiple regression analysis with SPSS V.16 application for Windows.The results of this study prove that income does not affect the granting of credit with a value of 0.857> 0.05, Fund management affects the granting of credit with a value of 0.003 <0.05 and Revenue (X1) and Fund Management (X2) simultaneously for Credit granting (Y ) with a value of 0.005 <0.05. Based on the results of the analysis it can be seen that the R square value is 0.119 or 11, 9% management of funds. This means that the influence of the fund management variable on the provision of bank credit has an influence of 11, 9%Keywords: Income, Fund Management, and Credit Granting