Credit Repayment Research Articles

Patterns and heterogeneity in credit repayment performance: Evidence from Malian farmers

Patterns and heterogeneity in credit repayment performance: Evidence from Malian farmers

Debtors Responsibilities in Subsidized Home Loan Takeovers Based on Indonesian Ministerial Regulation Number 26/PRT/M/2016

The transfer of ownership for Subsidized Home Ownership Loans (KPR) is prohibited unless the property has been occupied for over 5 years. Despite this rule, violations frequently occur, highlighting gaps in enforcement and a lack of debtor responsibility in credit repayment. This study addresses two main questions: 1) What are the responsibilities of debtors in taking over subsidized KPR based on Regulation Number 26/PRT/M/2016 at Bela Berlian 3 Housing, Kampar Regency? 2) What are the legal consequences for debtors in such takeovers? Using empirical legal research with primary data, the study found that debtors often fail to meet their obligations, including the misuse of bank funds intended for housing debt repayment. This leads to defaults and breaches of contract. Unauthorized takeovers may result in the withdrawal of KPR subsidies, but enforcement remains inconsistent, causing legal uncertainty for new debtors. The research calls for stronger enforcement to prevent unauthorized KPR ownership transfers.

Penilaian Pembayaran Kredit dengan Logistic Regression dan Random Forest pada Home Credit

Global economic development has led to the high complexity of society's needs. Financial institutions are here to provide facilities to meet the increasingly complex needs of society. However, the existence of problem loans can be a serious threat so classification techniques in data mining are used to overcome this problem. This research develops a model that can predict customers' ability to make credit payments so that financial institutions can avoid problematic credit. In this research, the SMOTE resampling technique is used to see the effect of sampling in dealing with class imbalance and conducting credit assessments. The research results show that the model built using SMOTE has better AUC than the model without SMOTE. From the two machine learning algorithms, logistic regression and random forest, the results show that the random forest model with SMOTE has the best performance with an accuracy value of 90%, precision of 92%, recall of 88%, F1-score of 90%, and AUC value of 0.97. Based on the best model, ten important features were obtained that influence the process of assessing credit repayment capabilities, namely the normalized score from external data sources, the period for changing customer numbers, the number of previous installment payments, the customer's age, registration time, the period for applying for credit at the credit bureau, the period for changing identity documents, the time for updating information at the credit bureau, and the length of time the customer has worked. In addition, this research produces visualizations via dashboards that can be used to improve the process of assessing credit repayment capabilities.

The Effect of the Amount and Term of Credit and the Debtor's Business Income on the Repayment of People's Business Credit

This study aims to determine the influence of the loan amount, loan term, and debtor's business income on the repayment of People's Business Credit (KUR) at Bank BRI Unit Cijeruk, Bogor, with the account officer as a moderating variable. Credit repayment refers to the debtor's ability to repay the loan, which affects credit collectability. The study population consists of 2,589 debtors registered at Bank BRI Unit Cijeruk in 2023. From this population, 104 debtors were selected as samples using purposive sampling techniques. The analytical tools used in this study are logistic regression and Moderated Regression Analysis (MRA). The results indicate that the loan amount, loan term, and debtor's business income have a significant impact on KUR repayment. Furthermore, the account officer, as a moderating variable, is proven to moderate the effect of the debtor's business income on KUR repayment. However, the account officer does not moderate the effect of the loan amount and loan term on KUR repayment. These findings highlight the importance of the role of account officers in enhancing the effectiveness of KUR repayment, particularly in the context of the debtor's business income, while they do not provide a moderating effect on the loan amount and loan term.

TINJAUAN YURIDIS TERHADAP KEDUDUKAN PENJAMIN PERORANGAN (BORGTOCHT) DALAM PENYELESAIAN KREDIT MACET DI PT. BANK PERKREDITAN RAKYAT DATA SEMARANG

The aim of this research is to analyze and examine individual guarantees guaranteed by debtors to creditors (Banks) in credit agreements. The approach method used in this research is normative juridical, with research specifications in descriptive analytical form. The results of the research show that individual guarantee arrangements are regulated in the Civil Code. An individual guarantee is a third party that guarantees all of the debtor's obligations to the creditor, if the debtor defaults. The position of individual guarantees at BPR DATA is an additional (accessory) that accompanies the main agreement. Credit with individual guarantees at BPR DATA is unsecured credit or KTA with a monthly salary payment system through the treasurer/finance department with guarantee/approval from the head of the company/institution. A debt guarantor in this case has the position that he is bound and responsible to the bank for all debts of the debtor. For every credit with individual guarantees, a guarantee agreement will be made privately, in the guarantee agreement the guarantor has special rights. As in BPR DATA, as the leader who guarantees the credit of its employees, in its implementation, if there is a default, the salary, social security, or insurance is deducted as credit repayment.

The Role of the Biliary in the Implementation of Decisions on Applications for Execution of Property Security in Semarang District Court

In the implementation of credit in the community, there is a risk of default in repayment of credit. To anticipate default, creditors ask for collateral from debtors. The collateral can be in the form of material. If default still occurs, then one way to resolve it is through the courts. The process of resolving the default is decided by the Head of the District Court in each region, after which the Head of the District Court will assign a Bailiff to carry out the execution. The duties and functions of the Bailiff are not limited to carrying out the execution, but also the administrative duties of the court. In practice, the Functional Bailiff has been on duty in the field, but the guidelines for implementing the Bailiff's duties are still lacking. This then causes the Bailiff to also face obstacles. This research was written using a descriptive qualitative method with primary and secondary data sources as its supporters.

Willingness and capacity of borrowers for loan repayment among farmers in Delta State Nigeria

Willingness of borrowers to repay loan and their capacity to repay borrowed fund has been an enigmatic challenge in the financing of agricultural enterprises in the tropics. As it stands, there is lack of empirical information on willingness of borrowers to repay loan and their capacity to repay credit. Investigating this challenge will improve agriculture in Delta state, Nigeria. This study derives its significance from its implications and usability among credit institutions. This study investigates willingness and capacity of borrowers for credit repayment among farmers in Delta State, Nigeria. A multistage sampling approach was used to select 216 farmers, Descriptive statistics, multiple regression, and binary logistic regression were employed in the analysis of collected data. The findings of the study show a mean amount of ₦460,972.22 was borrowed and ₦253,268.52 was repaid with a loan repayment performance of 54.94% and loan default rate of 45.1%. Further result indicates that 56.5% of farmers express willingness to repay loans, while 43.5% show unwillingness to repay borrowed fund. Further finding reveals that 40% of the farmers possess capacity to repay loan.. The study revealed that there is a significant difference in loan repayment capacity of poultry< fish, < arable crop farmers, with an F-value of 5.669 and (P≤ 0.05). Regression analysis identifies significant predictors of loan repayment capacity to include stock size, off-farm income, and farm income. Diversified income sources and effective farm management practices play crucial roles. Logistic regression indicates that longer repayment periods, larger stock sizes, and greater farming experience positively influence farmers’ willingness to repay loans (P≤0.05). It was recommended among others that financial institutions should offering flexible loan terms and sizes according to borrowers capacity. Encouraging farmers to diversify their income sources can improve loan repayment capacity of farmers.

ALTERNATIVE DISPUTE RESOLUTION IN CREDIT AGREEMENTS IN THE BANKING SECTOR

This research aims to find out the alternative settlement of bad credit disputes over the deed of granting mortgage rights. In principle, someone who wants to borrow money from a bank must have sufficient collateral to guarantee his debt. Mortgage rights on land are given as collateral for one's debt, in the form of encumbrance on land rights and objects that are legally integrated with the land. Not all loans banks provide borrowers can be repaid fully under the agreement. Poor credit repayment from debtors can be due to carelessness, lack of good faith, or due to their incompetence. To prevent losses for the lending bank so that debtor customers can continue paying their obligations. This study aims to identify alternative methods of resolving conflicts of mortgage rights related to bad credit. The author uses a normative juridical approach method by referring to the legal standards applicable in Indonesia. In order to analyze the existing problems, normative juridical analysis is the method used. Bad credit disputes that affect the granting of mortgage rights can be resolved through alternative dispute resolution. Compared to litigation, alternative dispute resolution can result in a significant settlement of bad credit by prioritizing a win-win solution where the parties' free will is maintained.

Input credit scheme, farm productivity and food security nexus among smallholder rice farmers: evidence from North East Ghana

PurposeThis study examined the impact of the Input Credit Scheme (ICS) by the Integrated Water Management and Agriculture Development (IWAD) on the productivity and food security of smallholder rice farmers in Ghana.Design/methodology/approachCross-sectional data from 250 rice farming households in the Mamprugu Moagduri district of the North East Region obtained from a multi-stage sampling technique were used for the study. Inverse Probability Weighted Regression Adjustment (IPWRA), Propensity Score Matching (PSM) and Kendall's coefficient of concordance were the methods of analysis employed.FindingsEmpirical results show that education, rice farming experience, dependency ratio, FBO membership, farm size and farm age were the significant factors influencing participation in the input credit scheme (ICS). Also, participants had an average rice productivity of 1,476.83 kg/ha, whereas non-participants had 1,131.81 kg/ha implying that participants increased their productivity by about 30%. In addition, the study revealed that participant households increased their household dietary diversity (HDDS) by 0.45 points amounting to about 8% diversity in their diets. High-interest rates associated with credit received, the short periods of credit repayment and the high cost of inputs provided under the scheme were the most challenging constraints associated with partaking in the ICS.Practical implicationsThe available literature on agricultural interventions have predominantly emphasized input credit as a key factor for improving cropt productivity and food security of smallholders. This study provides compelling evidence that participation in ICSs can result in substantial benefits for agricultural development, as evidenced by increased productivity leading to improved food security. The significance of these findings is highlighted by the fact that, through participation in input credit schemes, smallholder rice farmers in many developing countries see substantial improvement in their capacity to access productive resources, thereby improving their productivity, while simultaneously reducing food insecurity.Social implicationsLeveraging on the improved productivity of participants in the ICS, this study advocates that such input credit schemes should scale up to more food-insecure farming communities in Ghana.Originality/valueThe study uses a doubly robust econometric approach to evaluate the impact of ICS on smallholder rice farmers' productivity and food security in Ghana, making it the first of its kind. The findings offer a solid basis for future research and provide guidance for policymakers looking to boost agricultural development in Ghana.

Determinants Influencing Cocoa Farmers’ Satisfaction with Input Credit in the Nawa Region of Côte d’Ivoire

Assessing farmers’ satisfaction with Input Credit (IC) is essential for agricultural modernization in Sub-Saharan African countries. Therefore, based on farmers’ socio-economics data, this study aimed to determine the potential factors influencing farmers’ satisfaction with IC. The data were collected through a questionnaire from a random sample of 311 farmers in the Nawa region of southwestern Côte d’Ivoire in November 2022. Farmers rated constraints in the use of IC on three main indicators: (1) availability of inputs, (2) accessibility, and (3) credit repayment conditions. In addition to the descriptive statistics, a logistic regression model was constructed to compute the results using Stata 17.0 software. The main findings of descriptive statistics showed that 61.97% of the farmers were dissatisfied with using IC, while 38.03% were satisfied. The results also indicated that about 61.15% of farmers were constrained by credit services for inputs, compared to 38.85%. The logistic regression results revealed that the factors that significantly influence farmers’ satisfaction were annual production required and the number of years (at 1%) of IC use, training programs for farmers, farm size, input price (at 10%), and age (at 5%). Accordingly, cacao production in Côte d’Ivoire still faces multiple and complex factors. So, the results provide practical implications for policymakers and innovators to support smallholder farmers in providing high-quality technology innovation adoption programs.

Developing Monetary-Credit Tools in National Economy of Russia

The article analyzes work of the Bank of Russia and puts forward suggestions for new monetary-credit tools, which can ensure progressive development of country economy in conditions of rejecting one-polar system of international relations. Policy of the Bank of Russia is characterized by consistent use of such tools as ‘sterilization’ of money stock, its ‘pressing’ by key interest rate, gold selling. These methods implementing basic principles of market fundamentalism in the monetary variant hinder the development of national economy. To replace them the authors propose to fix in the legislative way a direct responsibility of the Ministry of Finance of Russia and the Bank of Russia for attaining planned macro-economic figures and to introduce their coordinated work in line with the Ministry of Economic Development of Russia that can be headed by Deputy Prime Minister. According to the authors it is advisable to pass to policy of real post-capitalism and interest-free economy, as elimination of credit repayment can become a serious incentive factor of intensification for entrepreneurial and working activity. In the monetary sphere it is recommended to introduce the digital ruble in two forms that could delimit deals: with industrial and consumer goods. As a result Russia could show an example of successful solution of the problem acute for many countries, i.e. development of a new system of monetary and credit relations, which on the basis of proposed tools can guarantee a real growth in production and people well-being.

RESCUE OF COLLATERAL OBJECTS OWNED THIRD PARTIES DUE TO BREACH OF DEBTORS WITH SUBROGATION AS LEGAL REMEDIES IN SHIP CASES ABOVE 20 m3

Payments can also have limited consequences in the sense that these payments only result in the role of the Creditor being replaced by another Creditor and the Debtor will be faced with a new Creditor who has the right to request payment from the Debtor or what is known as Subrogation and in this study occurs in the case of ships over 20 m2 as a Hipotek . Ships can meet the criteria or requirements to become collateral for credit settlement in the form of a Hipotek. Ships As Collateral for Repayment of Credit where the Hipotek is a material right to immovable objects. Ships can be divided into two, namely those weighing above 20 m 3 and below 20 m 3 . This paper aims to find out which ships can be charged with a Hipotek, so that they can be used as collateral for credit repayment. The method used is normative legal research, namely an approach by studying the applicable laws and regulations. The conclusion of this paper is that a Hipotek is a form of credit repayment guarantee, which is regulated in Burgelik Wetboek . Hipotek can be applied to objects in the form of ships. Ships As Guarantees for Repayment of Credit where the Hipotek is a material right to immovable objects which in this study uses subrogation as a legal remedy used.

A Survey of Banks in Ghana's Credit Risk Management Practices

In recent times, banks and other financial institutions that lend money to customers have placed a high priority on credit risk management. To manage credit risk, banks employ customer evaluation systems, loan size restrictions, credit checks, flexible loan repayment plans, and fines Hence, the present study focuses on the credit risk management practices used in banks, to identify the internal control measures used in mitigating credit risk in banks and to examine the challenges faced in implementing credit risk management practices. The Ordinal Logistic Regression(OLR) was used to identify the relationships between the response variables, e.g. management support, credit risk identification, internal control measuers and credit risk management surveys. The independent variables were calculated on an ordered, 5-point Linear scale for the responding participants. In this study, log lit function was chosen, that demonstrated the model appropriateness. One of the main finding is that in banks, credit management risk is reduced when managers implement and adhere to responsible credit risk management procedures, viable client appraisal credit management system, regular credit checks, flexible credit repayment systems to encourage and improve loan repayment, were highly significant with the respondents’ positive initiative amidst credit risk management practices in banks.

Heterogeneous Social network shape ability and willingness of rural residents to repay loans in China

This paper studies the impact and mechanism of heterogeneous social networks on credit repayment ability and willingness among Chinese rural residents. Based on the biprobit model with partial observability, we find a complementary relationship between repayment willingness and ability, and the heterogeneous social network effect differs with its nature. For repayment ability, bridging and bridged-linking social networks have positive effects whereas bonding and bond-linking social networks have insignificant effects. For repayment willingness, bonding and bond-linking social networks have positive effects whereas bridging and bridged-linking social networks have insignificant effect. Exploring mechanisms suggest that heterogeneous social networks affect repayment ability by alleviating income uncertainty, enhancing resident assets, and sharing risks; they shape repayment willingness through supervision, reputation, and punishment. Finally, the promoting effect of bonding and bond-linking networks on repayment willingness is enhanced by the construction of formal credit systems and the improvement of the informal credit climate.

Fuzzy Expert System for Bank Loan Approval

Background: Bank loan approval is one of the important pillars of the banking system; it is the process of approving or denying a loan to companies or individual customers by the bank. The approval process has a lot of parameters to be taken into consideration, which is ambiguous in nature; hence, bank loan approval required special knowledge to be executed. Aim: Due to the ambiguity of the approval process, we proposed the use of a fuzzy expert system which proved to handle such ambiguous problems to help banks easily and accurately make decisions on bank credit approval. This proposed fuzzy expert system will help banks in making accurate decisions easily even in the absence of the domain expert on credit approval based on the knowledge of an expert in the field. Method: The proposed fuzzy expert system was developed using a fuzzy tool in MATLAB software and it has two stages, where the first stage decides on three output parameters which are repayment, ability manage, and risk. Total asset, credit repayment, 18% earning, business stability, credit missed, asset/debt ratio, bond rating, and dollar to Naira ratio are the input parameters for the first stage of the system. The second stage of the system used the output parameters values of the first stage as its input parameters to make the final decision on whether to approve the credit or not. Results: Using 0.938, 0.583, 0.715, 0.88, 0.104, 0.897, 0.842, and 0.856 membership degree for total asset, credit request (loan amount), 18% earning, business stability, asset/debt ratio, bond rating, and dollar to naira ratio respectively as an input to the first stage of the system, the resultant output were 0.625, 0.367, and 0.25 for repayment, ability manage, and risk respectively, and those were feed to the second stage and result in 0.656 loan membership degree which means the loan can be approve to the customer

APPLYING THE CLASSIFICATION TREE MODEL IN CREDIT RISK ASSESSMENT

The aim of the study was to assess the possibility of using the classification tree model as a tool supporting the banks operations by reducing credit risk. The question of the possibility of using advanced statistical models as tools to support the activities of banks was presented. A classification tree model was demonstrated to reduce risk in credit decision-making. On the basis of a database of 1,308 successful credit applications (in 2015-2015), described by a set of 27 characteristics of a potential borrower. The model with 93% accuracy indicated statistical regularities allowing to identify a priori credit applicants customers who will fulfill the contract and customers who are likely to have problems with credit repayment. The first criterion for dividing the set of customers into good and bad was default in the last three years. Other important risk factors were having a limit in the ROR, having an account with the lending bank and the amount of debits declared by the applicant. The age of the borrower and his occupation were also important. Against the background of the results obtained, the possibilities offered by the classification tree model were discussed, and attention was paid to its intuitiveness and ease of interpretation. The benefits of using such models in managing the risks associated with the credit activities carried out by cooperative banks were analysed.

Financial Literacy and Credit Repayment in MFIs: The Case of the Mutual ASJD in Togo

Financial Literacy and Credit Repayment in MFIs: The Case of the Mutual ASJD in Togo

Causal nexus between agricultural credit rationing and repayment performance: A two-stage Tobit regression

<abstract> <p>The probability that the beneficiary would default on future payments poses a great risk to extending agricultural credit. Also, previous research on farmers' repayment of agricultural credit emphasized that a high default rate is a growing concern, thereby becoming a tall order for financial institutions to lend to farmers. Similarly, past studies accentuate an increasing focus on socio-economic characteristics as factors that explain the repayment rate. The nexus between repayment rates and credit rationing has not been well analyzed. The effect of credit rationing on repayment rate was therefore investigated. The study, therefore, investigates the causal effects of credit rationing on loan repayment performance using a structured questionnaire to elicit information from selected 240 respondents via a three-stage method of sampling technique, and the instrumental variable Tobit technique to analyze the effect of credit rationing on repayment performance. The result showed that the majority (70.83%) of the respondents are males, the mean age was 51 years with an average education year of 12.65. The result of instrumental variable Tobit regression confirmed the endogeneity of rationing rate (Wald test of exogeneity = Wald Chi2 (1) = 67.26; Prob > chi2 = 0.000) at a 1% level of statistical significance. The result with a Log-likelihood function (265.62459) revealed that the ration rate, among others, with coefficients of 0.4335, was a crucial factor in ascertaining the rate of repayment at various significant levels of the arable crop farmers in the research area. The key finding is that credit rationing did have a significantly positive influence on agricultural credit repayment. The research concluded that the significance of credit rationing in influencing the likelihood of repayment rate, points to the vital significance of adequacy in rationing borrowers.</p> </abstract>

A review of classification on credit repayment default behaviour using machine learning algorithms

A review of classification on credit repayment default behaviour using machine learning algorithms

Pengaruh Sistem Pengendalian Internal, Karakteristik Personal, Kondisi Ekonomi, Besar Pinjaman, dan Nilai Jaminan terhadap Pengembalian Kredit pada PT. BPR Nusamba Rambipuji

Repayment of credit is the ability of prospective debtors to repay credit in accordance with the amount, schedule, and time period that has been determined. Not all debtors are able to return credit in accordance with the agreed agreement. At PT. BPR Nusamba Rambi Puji the rate of return on current loans fluctuated from year to year. The purpose of this study was to examine the effect of the internal control system, personal characteristics, economic conditions, loan size, and collateral value on loan repayment (PT. BPR Nusamba Rambi Puji). The independent variables used include: Internal Control System (X1) Personal Characteristics (X2) Economic Conditions (X3) Loan Size (X4) and Collateral Value (X5). The dependent variable is Credit Return (Y). The sample in this study were the credit employees of Pt. Bpr Nusamba Rambipuji selected through purposive sampling method. The analysis used is multiple linear regression analysis, F test, t test, and data quality test through validity and reliability tests. Simultaneously the results of the analysis show that all independent variables have an influence on credit repayments. Meanwhile, it is partially known that the internal control system and the size of the loan are variables that have an influence on credit repayment.