Credit Limit Research Articles

PROCESS MODEL OF FORMING THE OPTIMAL STRUCTURE OF FINANCIAL SOURCES AT BUSINESS ENTERPRISES UNDER CONDITIONS OF ECONOMIC REVIVAL

The methodological and practical recommendations for the use of a process model for forming the optimal structure of financing sources at business enterprises under conditions of Ukraine's economic revival are substantiated. Despite the existence of some proposals regarding the mechanisms for forming the optimal structure of sources of financial resources at the level of business structures, the practice of implementing their various components by stages of the project cycle is of great interest. The etymological content of the scientific category “financial resources of the enterprise” is generalized and the composition of own, attracted and borrowed financing sources is specified. At the conceptual level, the algorithm for the optimal ratio of equity and borrowed capital at business enterprises is recommended, which allows determining the directions of attracting individual sources of financial resources. Within the framework of the process approach, the author's version of the process model of forming the optimal structure of financial sources at business enterprises is proposed, with the following five stages: selecting the optimization criteria and determining the target structure of financing sources; comparison of the achieved structure of sources of financial resources with their target structure; identifying limitations; selection of alternatives for forming sources of financial resources; provision of feedback and transition to the stage of researching the target capital structure. When forming the optimal structure of financing sources at business enterprises, depending on the classification features, the author identifies the limitations that affecting the structure of financial resources, namely: legislative limitations (related to the timing of attracting and using various types of financial resources and to the peculiarities of the taxation system); industry limitations (taking into account the period of raising funds, the size of the enterprise's value added and the degree of intra-industry cooperation); market limitations or limitations imposed by capital market participants (credit limitations, financial or stock limitations, limitations related to the lack of credit history of the borrowing enterprise). The expediency of dividing the established limitations into general and partial ones is substantiated.

Financial Inclusion And Financial Well-Being Of Ambulant Vendors In Kapalong, Davao Del Norte

The study explores the level of financial inclusion and financial well-being of ambulant vendors in Kapalong, Davao del Norte. This study utilized the descriptive-correlation design utilizing the adaptive questionnaire, which was validated by the panel of experts in both independent and dependent variables. Statistical tools used in the study were mean and Pearson-r for the treatment of the data collected and gathered. Eighty-eight respondents from 14 barangays in Kapalong were selected using random sampling. The results revealed that the five indicators of financial inclusion: financial literacy, accessibility, availability, affordability, and usage were rated high. It also revealed that the mean of the indicators from financial well-being got a high descriptive level, which includes financial preparedness, beliefs of credit limits, and risky indebtedness behavior. The result showed that there is a significant relationship between financial inclusion and the financial well-being of ambulant vendors in Kapalong, Davao del Norte. This concludes that all measures of financial inclusion used in this study have a high relationship with financial well-being. Therefore, the two variables were highly significant to each other. Keywords: financial inclusion, financial well-being, descriptive-correlation design, ambulant vendors, Kapalong, Davao del Norte

A computational model of bilateral credit limits in payment systems and other financial market infrastructures

This paper provides the first steps towards a theoretical and structural modelling framework through which optimal decision making in financial market infrastructures such as payments clearing and settlement systems can be assessed from a market microstructure perspective. In particular, the paper focuses on the application of agent-based computational economics and stochastic games in modelling the bilateral credit limit establishing behaviour of Participants in loss sharing arrangements within financial market infrastructures such as the Canadian Large Value Payments System (LVTS). With specific focus on the LVTS, the paper presents a structural model where the payments system represents a market in which bilateral credit limits are the pricing mechanisms for intraday liquidity provisioning and the credit risk arising from the loss sharing arrangement. The data-driven stochastic game framework further illustrates how payments data, in conjunction with other financial market and credit data, can be used to assess emergent macroscopic outcomes in clearing and settlement systems from the underpinning interactions of autonomous decision making agents. The paper speaks to potential policy issues such as the effectiveness of policy levers such as the System-Wide Percentage, regulatory concerns around procyclicality and free-riding arising from the market microstructure behaviours, and design of the System.

An investigation into the financial challenges affecting the success of entrepreneurs in South Africa

The object of this study is the financial difficulties that impacted the success of business owners in Hatfield, Gauteng province, South Africa. Compared to a global failure rate of 50 %, five out of every seven entrepreneurs in Hatfield, South Africa fail during the first year of operation. This study aimed at looking into the relationship between entrepreneur failure and financial literacy. The methodology employed in this study is interpretive philosophy-based qualitative research. An ethnographic research technique was also used to analyze the current economic condition of business owners in Hatfield. The population was sampled using non-probability purposive sampling techniques. Semi-structured interviews were used to gather the study's leading source of data. The primary research results are thematically examined while also considering the secondary sources. Eliminating financial and liquidity constraints was listed as a goal of financial literacy. Findings garnered revealed that financial, liquidity and credit restrictions are the primary causes of business failures in Hatfield. The lack of financial resources for new businesses in Hatfield, as revealed, prompted several liquidity issues in Hatfield, and further lowers the growth rate of Hatfield businesses. It was discovered that Hatfield's entrepreneurs usually experienced premature failure due to inadequate financial education and training. Impliedly, Hatfield business owners possessed poor cash management, defaulting on loan payments due to lack of financial education. Conversely, only few entrepreneurs and business owners in Hatfield, South Africa possess financial literacy competence with the necessary skills needed to better analyze their financial statements appropriately and increase profitability of their business. The practical implication of this finding is that, most entrepreneurs have high possibility to experience premature business liquidity when they have low or no financial literacy.

The determinants of credit restrictions and their impact on micro firms: the case of Colombia

PurposeThis article analyzes the determinants of credit constraints and their effects on the productivity of micro-firms in Colombia.Design/methodology/approachAn Endogenous Switching Regression Model (ESRM) is estimated to analyze credit constraint impact on economic performance.FindingsThe results show that owner characteristics such as age and gender decrease the likelihood of being constrained. Firms' characteristics, such as legal status, the formality of the employees, commercial property and savings, are important for reducing credit constraints.Originality/valueThis article discusses how formal credit restrictions harm the economic performance of Colombia's micro-firms. The results show that the productivity of the micro firms in Colombia could increase, on average, by U$ 825 USD when all types of restrictions are eliminated.

OPPORTUNITIES AND CHALLENGES IN E-BANKING SERVICE IN DIGITAL ERA

Another word often used interchangeably with electronic banking is “digital banking”. Both words are used equally often. However, strictly speaking, banks rarely or do not use paper money. However, the use of paper money is still widespread. Today's ATMs are an important part of the banking system because they allow consumers to withdraw money when needed. In the digital economy, there are almost no monetary transactions. Cash is often thought of as something that is free. But using cash is expensive. Foreign exchange spending is discussed in a Harward Business Review research article titled “Countries that would benefit most from a cashless society.” Consumer expenses (like ATM fees, foreign exchange commissions, etc.) are included in cash costs. Because, To analyze the impact of CBDC concerns on the global environment, Dong (2021) studied statistical models. If CBDCs are the only method of capturing value, then higher interest rates cannot lead to financial disintermediation. Due to the complementarity of these deposits and the deposits offered by CBDCs, banks and companies will lend more money and invest more in them. The central bank has asked banks and non-banking financial companies (NBFCs) to ensure that digital lending applications (DLA) do not automatically increase credit limits and access to resources their mobile. borrower. RBI said borrowers must be given time to review or seek exit from the digital loan by paying the principal and corresponding Annual Percentage Rate (APR) within this period without incurring penalties in 'Guide to digital lending' for regulated institutions or RESs (banks). and NBFC). However, it is still unclear how CBDC will actually affect the banking industry and the economy. Ten of the eleven countries that have introduced official digital currencies are small nations in the Eastern Caribbean, including Jamaica and the Bahamas. In October 2021, Nigeria became the only major country to introduce CBDC for retail. Therefore, the RBI will have to introduce CBDC and conduct pilot testing very carefully. Banks' operating costs have been significantly reduced thanks to digital banking. With this, banks can now offer better deposit interest rates while charging lower service fees. Bank profits increased due to reduced operating costs. Conclusion: Indian banks still have a long way to go before adopting technology at par with banks around the world. Keywords: Digital Banking, Digital Currency, Blockchain Technology, Digital Retail Lending

Micro Finance Credit Scheme and Youth Entrepreneurship Performance in Rwanda: A Case of Youth Facilitated by Vision Fund in Nyarugenge District

This study aimed to assess the contribution of credit schemes on youth entrepreneurship in Rwanda, specifically in Nyarugenge district. The research involved 540 respondents, including 72 youth entrepreneurs, eight local leaders, and two Vision Fund staff. Both qualitative and quantitative data were used, with the quantitative data containing statistical expressions to interpret achievements. The results showed that fixed pay and salary increases employees' performance, while minority disagreed. The null hypothesis was rejected, and the alternative hypothesis was accepted, indicating that the independent variable influences youth entrepreneurs' performance at Vision Fund, Rwanda. The regression equation demonstrated that youth entrepreneurs' performance at Vision Fund, Rwanda will always depend on a constant factor of.453, regardless of other factors. The majority of respondents agreed that microfinance has an average number of days a borrower needs to pay bills and obligations in specified periods, while minority disagreed. The ANOVA showed a p-value less than 0.05, indicating that there is no statistical significant relationship between credit limits and collection period and youth entrepreneurs' performance. Therefore, credit limits and collection period in Vision Fund are not implemented by top management, which does not have a statistical influence on youth entrepreneurs' performance. The researcher suggested several recommendations for management, such as understanding the default probability of default of entrepreneurs to gauge their future default risk, having a standard credit limit for existing terms and conditions in microfinance, and collecting customer information to improve customer satisfaction and retention. Overall, this study highlights the importance of credit schemes in fostering youth entrepreneurship and promoting economic growth in Rwanda.

The tobacco small farmers and impact of restrictive credit policies on the planted area in Brazil: assessment of tobacco control policies

The tobacco small farmers and impact of restrictive credit policies on the planted area in Brazil: assessment of tobacco control policies

Analisis Tingkat Kesehatan Bank Dengan Metode Risk Based Bank Rating (RBBR) Pada PT. BPR Supra Artapersada KC. Cibadak

The assessment rating of bank hlth is expected to evalute the prformance of the banking industry. Because bank healtiness represent good financial condition and good management. Risk-based Bank Rating (RBBR) method is used Bank Indonesia as a standard to appraise the rating of the bank health. This study to find out the sundeness level of bank in terms of the aspects of Risk profille, Good Corporate Govermance (GCG), Earnings, and Capital. This was an deskriptif analysis, with the object study is BPR Supra Artapersada Kc. Cibadak, PT. the data were collected through documentation and date analysis techniquen was an analysis of the soundness of bank using the Risk-Bases Bank Rating approach with an assesment converage including Non Ferforming loand, Loan to Deposit Rating, Good Corporate Governmence, Return on Assets, Operational costs on operating income, and Capital Adequacy Ratio factors. The resulth howed the condition of BPR Supra Artapersada Kc. Cibadak, PT. at “healthy criteria” with Non performing Loand of 1,8%, Loan to Deposit Rating of 85%, Maximum credit limit of 0,083%, Return on Assets of 0,034%, Operational costs on operating income of 0,070%, and Capital Adequacy Ratio of 41%..

The magnifying role of the banking sector during depressions

Is there a magnifying role of the banking sector during depressions? How can a financial perturbation, possibly small-sized, create large impacts on output and enduring recessions? What is the role played by the massive stock of due claims brought about by a financial crisis? We address these questions by putting forth a general equilibrium model endowed with a banking system in which due claims – henceforth named due loans – and occasionally binding credit restrictions coexist and their effects reinforce each other. Under “bad” financially-driven perturbations due loans hike and the concomitant opportunity, holding, regulatory, and impairment costs trigger sizable increases in external finance premia and promote credit restrictiveness. Firms’ net worth collapses as they are called in to finance banks’ problems, and their ability to invest and accumulate capital becomes compromised. The amplification effect can be very large: the full-fledged banking model may only require a perturbation of one-tenth the size of a plain vanilla version to deliver the same output drop at the trough. Effects are non-linear, since credit restrictions remain slack on the boundary of the steady state, and asymmetric, since these restrictions play no role whatsoever under “good shocks.”

Analisis Hukum Ekonomi Syariah Mengenai Online Marketplace Shopee (Studi perbandingan Akad Qardh, Fatwa DSN No 19/DSNMUI/IV/2001 dan ketentuan perjanjian Fitur "SPinjam")

This study aims to determine how the Qardh Akad Analysis in the SPinjam Feature on the Shopee Application. Shopee Pinjam (SPinjam) is an online cash loan product that offers loans with a fast, safe, minimal risk and unsecured process. So that SPinjam becomes an alternative for people who need funds. because Indonesia is a majority Muslim community, this Marketplace must be adjusted to Sharia provisions. There is no Fatwa specifically related to the Marketplace. The formulation of the problem in this study How is the mechanism of Terms and Conditions of Shopee Pinjam Services for Loan Recipients on the Shopee Application, How is the Analysis of the Conformity of Qardh Akad with the Terms and Conditions of Shopee Pinjam Services for Loan Recipients on the Shopee Application and How is the Analysis of DSN-MUI Fatwa No: 19/DSNMUI/IV/2001 with the Terms and Conditions of Shopee Pinjam Services for Loan Recipients on the Shopee Application.This type of research is library research, the data analysis method uses normative descriptive methods, uses a fatwa approach and inductive thinking. The results of this study indicate that: Users of the SPinjam feature in the Shopee application are Shopee application users who have reached the gold member level with a certain credit limit. The loan consists of a disbursement fee of 1% monthly installment fee (5%/month) and a monthly SPinjam protection fee (0.25%/month). The conformity between DSN MUI Fatwa No.19/DSN-MUI/IV/2001 and the SPinjam Terms and Conditions of Service document can be concluded that it is not fully in accordance with the provisions of sharia principles. The conflicting points of the SPinjam Document are related to the following; loan repayment system in the form of credit, late fees, loan interest, risk of credit failure for borrowers and dispute resolution institutions

АНАЛІЗ КОНКУРЕНТОСПРОМОЖНОСТІ ЦИФРОВОГО БАНКІНГУ В УКРАЇНІ

The article analyzes the state of digital banking in Ukraine in order to identify the competitiveness of this sector of the economy. The Ukrainian banking system has gradually accustomed its consumers to the technology of services and the digital environment, using the latest technologies and introducing them into its activities at all levels. Accordingly, the latest technologies are used, high service and interesting applications are offered, which are pleasant and convenient to use. At the same time, the approach to all banking operations is changing, they are becoming increasingly easy, fast and convenient and do not involve visits to branches at the physical level. In total, 66 banks operate in Ukraine, among which only 5 are included in the list of systemically important banks of Ukraine: JSC "KB PrivatBank", JSC "Oshchadbank", JSC "PumbBank", "Sense Bank" and "Monobank". The article compares the activities of Ukrainian banks according to the following indicators: Number of employees, Number of customers, types of cards, cashback, availability of partner programs, Annual interest on the loan, Grace period, Credit limit without collateral, Annual interest on the deposit. The dynamics of the main financial indicators of the mentioned competitors in the digital banking market of Ukraine were also studied: net profit, net interest income, and commission income. It has been established that the largest technological banks in Ukraine have joint projects with fintech companies. The exception is "PrivatBank", which has its own powerful development center. PrivatBank continues the active digitization of its services and financial services, which have long since gone beyond classical banking and are forming a new digital ecosystem in Ukraine at the junction of financial services, retail and e-commerce. In addition, Ukrainian banks have their own centers for incubation and acceleration of startups – they expect to receive a return from them in the form of innovative products and services that can be implemented in themselves.

Assessing the Challenges and Impact of Access to Agricultural Credit in Southern Punjab (Pakistan): A Qualitative Study

Pakistan's agriculture industry, distinguished by its variety of animals and crops, has historically been the foundation of the country's economy. It contributes significantly to GDP, employs a considerable section of the people, and assures food security for the country. Despite its vast potential, the agricultural sector continues to struggle with issues including low productivity, susceptibility to climate change, and inadequate access to financial resources. Investigating the Credit Barriers to Bank Lending in Pakistan's Agriculture Sector was the aim of this study. The effectiveness of present lending processes, as well as the role of banks in providing credit to agricultural consumers, and the socioeconomic implications of bank credit in agriculture, were also explored. In-depth semi-structured interviews were the primary technique of data collecting for this study, which followed a qualitative research design. A total of 33 representatives from the NRSP Micro Finance Bank, Zari Tarraqiati Bank Ltd., and National Bank of Pakistan (NBP) in the Bahawalpur region, as well as some of the bank's visiting clientele, were the participants of the study. Data was extracted and analyzed using thematic analysis to reveal recurring themes and trends. According to the findings, banks in Pakistan encountered some credit challenges when offering loans to the farm industry. There were societal issues, knowledge gaps, legal constraints, and financial challenges. Stakeholder perspectives, including those of bank employees and farmers, provided a thorough picture of the problems at hand. This research contributes to the literature by offering an in-depth analysis of credit restrictions in agricultural financing in Pakistan.

UNVEILING CHURN PREDICTION AT BANK IVORY

The banking industry faces significant challenges in tackling customer churn within its credit card services. Customer churn refers to the situation where customers discontinue using a bank's services and migrate to another financial institution. To proactively address this critical issue, the present research endeavors to predict customer attrition in credit card services. To achieve this goal, the study extensively employs the CRISP-DM framework and diligently compares the performance of two predictive models, namely Gradient Boosting and Random Forest. The research endeavors to identify potential churn customers by analyzing crucial variables, including customer age, marital status, gender, income category, credit limit, and total transactions. The preferred modeling approach, determined based on the lowest misclassification rate, serves as a vital component of the research's analytical process. Remarkably, the research findings unequivocally demonstrate the superior performance of the Gradient Boosting model, which attains a misclassification rate of 0.1118 in predicting customer attrition.

Constraints in credit accessibility from primary agricultural cooperative societies in Haryana state, India

Abstract Subject and purpose of work: The objective of the study was to identify the constraints in credit accessibility from Primary Agricultural Cooperative Societies in Haryana State, India. Materials and methods: The primary data were used for achieving the objective of the study. The primary data were collected in the second quarter of 2022 by employing the schedule. The multistage purposive cum proportionate random sampling techniques were adopted to select a sample of 540 respondents. The percentage was used for data analysis. Results: The constraints in accessing credit are identified faced by beneficiary farmers and nonbeneficiary farmers. The major constraints faced by the beneficiary farmers in accessing credit from PACS are inadequate credit limit (87.40%), short time to repayment of loan (66.29%), high penalty rate (55.92%), and unavailability of medium-term loans (50.00%). While inadequate credit limit (80.00%), no new accounts opened (72.22%) and fear of being a defaulter (47.78%) were the major constraints faced by the non-beneficiary farmers in accessing credit from PACS. Conclusions: The various constraints were identified in accessing credit from PACS. Credit limits should be extended on the basis of the scale of the finance. Medium-term loans need to be increased.

How to halt deforestation in the Amazon? A Bayesian process-tracing approach

In this paper, we employ for the first time a Bayesian process-tracing approach to assess the role of different interventions designed to halt deforestation. We applied the methodology to six initiatives implemented between 2006 and 2019 in the municipality of São Felix do Xingu, namely: (i) institution of protected areas, (ii) environmental monitoring and enforcement, (iii) credit restrictions, (iv) commodity agreements, (v) multi-stakeholder processes, and (vi) value chain projects. Bayesian process tracing is an alternative to traditional counterfactual approaches that allows the gleaning of in-depth insights into ‘causal chain’ mechanisms and complex interrelationships in individual cases, rather than identifying common or cross-cutting features across different cases. Contrary to traditional process-tracing methodologies, the Bayesian approach provides analytical transparency and replicability through a formal and fine-grained assessment of the strength of the evidence. We assessed 31 individual pieces of evidence, developed using data collected through a variety of quantitative and qualitative methods. We grouped these into interventions spanning three periods of time and traced the causal mechanisms linked to their success or failure. In total, we developed nine theory components. Our results reveal that we are practically certain that four theory components are true. We are also reasonably certain or highly confident that four other theory components are true, and only cautiously confident that one component is true. Drawing on the nine components, we offer a composite theory explaining deforestation outcomes. Our findings provide four implications for global debates. Namely, they provide a strong case for the importance of conceptually distinguishing: the types of actors targeted (e.g., smallholder or medium-to-large landholders) and the frontier status (i.e., whether interventions take place in active frontiers or in consolidated areas). They also prove that interventions may be well implemented for a certain period but can lose effectiveness over time. Finally, our findings call attention to synergies among interventions, and in particular to the combination of regulatory interventions to halt frontier expansion with market-based approaches to incentivize non-deforestation behaviour.

Devolution of Agriculture and its Effects on Mango Marketing by Small-Scale Farmers in Makueni County, Kenya

The study aimed to evaluate the devolution of agriculture and its effects on mango marketing by small-scale mango farmers in Makueni County, Kenya. It utilised a descriptive research design and collected data in narrative and numerical formats from mango farmers in the county. The study used a semi-structured questionnaire and interviews; data was collected using a stratified random sampling technique. Quantitative data was analysed using frequencies, percentages, and correlation analysis in the SPSS (V27) package, while qualitative data from interviews was analysed using thematic analysis. The findings hold significant implications for policymakers, farmers, and researchers. Furthermore, the study informs small-scale farmers about the benefits of adopting good agricultural practices to improve the quality of their mangoes. Key indicators of devolution identified in the study include improved marketing guidelines, farm cooperatives, processing of farm produce, infrastructure development, improved bargaining power, provision of farm inputs, funding/soft loans, and training and capacity building. The benefits of devolution for mango farmers encompass increased decision-making authority, subsidies for farm inputs, and overall improvement in their lives. Some of the challenges faced by mango farmers are limited marketing options, restricted credit availability, and low prices for their produce. Based on the findings, there is a significant positive relationship between agricultural devolution and mango marketing. The correlation analysis indicates a positive relationship between devolution and the marketing of mangoes (r = 0.572, p = 0.000). The study concluded that although mango marketing cooperatives helped farmers, the Makueni County government lacked sufficient marketing options for mango producers. This resulted in limited market access, restricted credit availability, and low prices for their produce. The study recommends collaboration between the county government and mango farmers to increase demand and marketing approaches for mangoes.

Does fintech lending expansion disturb financial system stability? Evidence from Indonesia

Literature suggests two contradictory views regarding the impacts of fintech lending on banks. The competition-instability proponents believe that fintech lending expansion erodes bank market and threatens banks as traditional intermediaries, thereby intensifying bank risk-taking and potentially disturbing financial stability. In contrast, the competition-stability proponents believe fintech lending reduces asymmetric information in the credit market, thus reducing bank risk-taking and increasing bank resilience to a systematic shock. This paper aims to examine the impacts of fintech lending expansion on bank-risk taking, i.e., credit channeling activity and bank risk. This study utilizes the OLS, random effects, fixed effects, and two-step GMM regressions to test the conjectures. Consistent with the competition-stability hypothesis, our evidence indicates that shadow banking increases as banks actively seek channels to diversify their risks but are less likely to use fintech lending as a credit channel. This paper also corroborates the notion that fintech lending expansion encourages banks to diversify their risks. Pertaining to the relationship between fintech lending and bank risk, our results suggest that fintech lending expansion encourages banks to work more efficiently to improve their credit quality rather than to intensify bank risk-taking. These findings also indicate that synergy between fintech lending and banks would increase bank credit quality. This paper also examines the reasonable credit limits for fintech lending firms based on MSMEs’ characteristics. Employing the threshold regression, we find that IDR5 billion is the maximum credit provision to induce the profitability of MSMEs whereas IDR6 billion is the maximum credit provision to minimize the default risk of MSMEs.

Credit Management Practices and Financial Performance of Commercial Banks in Rwanda: A Case of Access Bank Plc

This paper examined the effect of credit management practices on financial performance of commercial banks in Rwanda with reference of Access Bank Plc. The specific objectives are to assess the effect of credit rating on performance of Access Bank Plc, to determine the effect of credit monitoring on performance of Access Bank Plc and to examine the effect of credit recovery on performance of Access Bank Plc. The researcher used liquidity theory of credit and the information theory of credit. The study used descriptive and correlational research design. The target population was 164 employees of Access Bank Plc. The study collected data from a sample size of 116 employees of Access Bank Plc at Head office in Kigali City. It used questionnaire and financial statements of Access Bank Plc to collect data and descriptive statistics and multiple regression model to analyse data. Descriptive statistics such as mean, frequency and standard deviation was used. The multiple regression analysis was use to assess the effects of multiple predictor variables on the dependent measure. Results from the first objective show that that access bank assessment of the capacity to pay loan was strongly agreed by 44.7% was used as a credit rating component at Access Bank Plc. Access Bank has used credit reference report as strongly agreed by 30.1% .Results from the second objective indicated that credit term was adopted as strongly agreed by 54.4%, credit standards as strongly agreed by 36.9 %, 40.8%, credit limits, 30.1% strongly agreed. Results to the third objective show models of loan repayment platform demonstrated that 53.4% of respondents strongly agreed with the statements. Therefore, 44.7 strongly agreed that the Access bank is continually assessment as 33.0%. Results 54.9% strongly agreed with legal enforcements. The study recommended that researcher’s asses this factors impact on credit management practices, its execution and financial performance. Keywords: Credit management, Credit Policies, Credit monitoring, debt recovery, financial performance

Dynamic common correlation effects of financial development, foreign direct investment, market size and trade openness on domestic investment: an income-level prognosis

PurposeThe study examined the impact of financial development, foreign direct investment, market size and trade openness on domestic investment for 119 countries divided into four panels that are low-income countries (LIC), lower middle-income countries (LMIC), upper middle-income countries (UMIC) and high-income countries (HIC) between 1995 and 2019.Design/methodology/approachThe present study bases its empirical procedure on the bases of the data mix. To this end, based on the presence of cross-sectional dependence, covariate-augmented Dickey–Fuller unit root and Westerlund cointegration second-generation tests were employed to validate the stationarity and cointegration of the variables, respectively. The novel Dynamic Common Correlation Effects estimator was employed to estimate the heterogeneous parameters while the Dumitrescu and Hurlin test was used to test for causality direction of the highlighted variables.FindingsThe empirical results show that market size and trade openness had a positive and statistically significant effect on domestic investment for all the income groups. Results also show that financial development had a positive and statically significant effect on domestic investment only for LMIC and HIC economies, while a positive and statistically insignificant effect was obtained for LIC, UMIC and the global panel. The causality results revealed a bidirectional relationship between domestic investment and the exogenous variables – financial development, foreign direct investment, market size and trade openness.Research limitations/implicationsIt is therefore, recommended that LIC and LMIC need to consider harmonising the financial system to lower credit limitations and adopt business-friendly policies. HIC and UMIC should seek more outward FDI policies and harmonise their trade policy, to reap more benefits from FDI and international trade.Originality/valueOn novelty, previous studies have been criticised for the effect on technical innovation of bank financing and institutional quality. This research tackles the deficiency using systematic institutional quality indicators and by taking other variables into account.