Good Credit Research Articles

Mekanisme Pinjaman Tanpa Bunga Kepada UMKM di Dinas Koperasi dan Perindustrian Kota Bandar Lampung Persfektif dalam Hukum Ekonomi Syariah

Following the global impact of Covid-19 on the economy, including Indonesia's, the Bandar Lampung City government has introduced an interest-free loan program aimed at UMKM to help revive the country's economy. During this crisis, it is crucial for the government to prioritize the UMKM sector as it plays a significant role in GDP and serves as a crucial source of employment, substituting the production of consumer goods or semi-finished goods. The interest-free and collateral loan program, initiated by the Bandar Lampung City Government through the Office of Cooperatives and Micro Enterprises (Diskop UKM), is designed to bolster the growth of Micro, Small, and Medium Enterprises (UMKM) in the region. The goal is to increase access to capital for MSMEs that do not have collateral or a good credit history, as well as create jobs. The program also promotes the Islamic principles of mutual care and justice. The use of APBD funds and loan requirements have been adjusted to the maqasid al-shariah principle. The Bandar Lampung City Government needs to make updates to improve the effectiveness of this program in terms of transparency, accessibility, requirements, procedures, and risk assessment.

Employer Credit Checks: Poverty Traps Versus Matching Efficiency

Abstract We develop a framework to understand pre-employment credit screening as a signal from credit markets that alleviates adverse selection in labour markets. In our theory, people differ in both their propensity to default on debt and the profits they create for firms that employ them; in our calibrated economy, highly productive workers have a low default probability. This leads firms to create more jobs for those with good credit, which creates a poverty trap: an unemployed worker with poor credit has a low job finding rate, but cannot improve her credit without a job. This manifests as an endogenous loss in present-discounted wages that is typically taken as exogenous in quantitative models of consumer default. Banning employer credit checks eliminates the poverty trap, but pools job seekers and reduces matching efficiency: average unemployment duration rises by 2 days for high productivity workers and falls by 13 days for low-productivity workers.

Fintech, financing constraints and corporate green innovation

This study comprehensively analyzes the panel data of 4195 listed companies in the A-share market during the period from 2011 to 2022, aiming to explore the mechanism of fintech's influence on corporate green innovation. The study adopts a two-way fixed effects model to confirm the positive association between fintech and corporate innovation, and reveals the role of fintech in promoting corporate innovation output by alleviating financing constraints with the help of a mediated effects model. The findings suggest that FinTech not only directly promotes firms' innovation activities, but also provides important support for firms' innovation by reducing financing constraints, a finding that is confirmed by a series of robustness tests.On this basis, this paper emphasizes that, in the face of market changes brought about by fintech, firms should proactively adapt to and take advantage of these changes to mitigate the pressure of high costs of external financing by maintaining good credit records and reducing information asymmetry. Such a strategy not only helps firms obtain more funds for R&D and innovation, but is also key to achieving sustainable development goals. In addition, policymakers should also recognize the important role of fintech in promoting business innovation and green transformation and take measures to encourage its development and application for the long-term health of the economy.

Determinants of livelihood diversification in an integrated agricultural and non-agricultural livelihood system in Ghana

The diversification of livelihoods by households has been widely acknowledged as a way to overcome food insecurity and poverty challenges in developing countries. Diversification of livelihoods helps spread the risk among multiple livelihood earning activities to provide households with a range of their food needs all year round. By examining the integrated livelihood systems of 405 rural farm households in the Upper East Region of Ghana, empirical evidence is provided in this study using the Sustainable Livelihoods Framework to advance arguments in the literature for the creation of sustainable strategies that improve diversified livelihood systems. The mean diversification indices estimated were 0.45 for agricultural diversification systems, 0.32 for non-agricultural diversification systems and 0.59 for integrated agricultural and non-agricultural diversification systems. With the use of the Cragg two-step regression model, we demonstrate that the decision to diversify and the extent of diversification of rural livelihoods are distinct decisions and are influenced by distinct sets of factors. Similarly, for the three categories of livelihood diversification studied, the effect of these factors also differed. The results emphasize the significance of access to good road network, credit and market information in encouraging rural farm households to diversify their livelihoods. In the short term, improving access to credit and market information through community-based initiatives can provide immediate support to rural households. Communities should also organize local markets and cooperatives to strengthen their economic resilience. While government and stakeholders should focus on long-term infrastructure projects, these community actions can complement such efforts and contribute to achieving global and regional goals targeting food insecurity and poverty eradication.

Risk Management as a Moderator of the Influence of Good Corporate Governance on Corporate Sustainability in Village Credit Institutions

Village Credit Institutions (hereinafter referred to as LPD) in Bali were established based on Bali Regional Regulation Number 2 of 2002 and have been amended several times. The existence of LPD is needed to ensure the realization of the welfare of the traditional village community. LPD must continue to strive so that its sustainability is maintained properly. A number of LPDs in Bali have developed well and their benefits are felt by the village community, but there are also LPDs in a number of villages that have not been able to develop well, and some are even not operating. Based on these conditions, this study was conducted to analyze a number of factors that can affect the sustainability of LPDs in Bali. This study focuses on those that are most likely to affect the sustainability of LPDs, This study focuses on good corporate governance and credit risk management in LPDs in Gianyar Regency. Good corporate governance includes six dimensions: participation, responsibility, independence, fairness, accountability, and transparency. Corporate sustainability is assessed through economic, social, and environmental performance. The research sampled 84 healthy LPDs registered with the Village Credit Institution Empowerment Institution (LPLPD) using purposive sampling. The LPD chairpersons served as respondents, and data analysis was conducted using the structural equation modeling (SEM) method based on partial least squares (PLS).

Pengaruh Kompetensi Karyawan, Motivasi Kerja, dan Kepuasan Kerja Terhadap Kinerja Sistem Informasi Akuntansi di LPD

The development and progress of Village Credit Institutions (LPD) can be seen through various achievements such as financial performance and operational results. A good Village Credit Institution (LPD) is recognized from its financial reporting system and services. In reality, not all (LPD) are able to use AIS wisely and accurately. The purpose of this research is to understand the influence of employee competence, work motivation, and job satisfaction on the performance of the accounting information system. The population consists of LPDs in Ubud Regency, Bali with a representation of 96 people. The data collection techniques used in this study include quantitative. The studies that have been carried out prove that employee ability has a positive effect on AIS performance, work motivation has a positive effect on the use of AIS, and job satisfaction has a positive effect on the use of AIS. We found that it had a positive impact. The magnitude of the influence of independent variables on the use of AIS is 65.4%.

Peran Badan Usaha Milik Desa(BUMDes) Dalam Meningkatkan Perekonomian Masyarakat di Desa Batu Belanak Kecamatan Suak Midai Kabupate Natuna

Village-Owned Enterprises are institutions that operate in the field of managing village economic resources which aim to optimize village assets, improve community businesses and increase village income. This increasingly narrow agricultural area has caused the people of Batu Belanak Village to complain because some of their harvests have failed, such as coconuts, the quality of the coconut harvest is not good so it is not suitable for sale and consumption by the local community. This research method uses qualitative research. The data collection technique is using interviews and documentation. There are 4 indicators according to Siagian's role theory (2000:142-150), namely Stabilizer, Innovator, Pioneer and Modernizer. The results of this research show that the role as a stabilizer for the sale of electricity tokens and telephone credit, cattle fattening is one of the BUMDes programs that is running in Batu Belanak Village, the need for cattle, especially Midai Island, the price of sacrificial cattle is too high and the cows that come out will get big profits, fishing gear for Village BUMDes fishermen Batu Belanak provides credit for goods. BUMDes provides credit for goods in installments. The role of BUMDes innovator in Batu Belanak Village will be to create a household credit program. The government's role as a pioneer is to first implement innovation to build cooperation with the community in terms of advancing the village. Role as a modernizer from traditional to modern conditions.

Islamic Bank Performance and Macroeconomic Variables During Economic Turbulence

The study aims to analyze the effect of internal and external bank factors on the financial performance of Islamic banks during the Covid-19 pandemic. The external factors or macroeconomic factors consist of BI Rate and Inflation. The internal bank factors used are BOPO (Operating Expenses for Operating Income), CAR (Capital Adequacy Ratio), FDR (Financing to Deposit Ratio), NPF (Non-Performing Financing), and ROA (Return on Assets). A quantitative analysis is applied to assess the research construct by using a panel regression approach. The data used is sourced from Bank Indonesia and the Financial Services Authority for the observation period from 2019 - 2021. The findings show that external factors do not affect ROA in the long run and short run. Meanwhile, the internal factors BOPO and CAR significantly influence ROA, and NPF is having a significant impact only in the long run. The implications of this study show that Islamic banks need to strengthen operational efficiency, maintain capital adequacy, and implement good credit risk management in order to increase profitability sustainably, regardless of external fluctuations such as BI interest rates and inflation.

An FTwNB Shield: A Credit Risk Assessment Model for Data Uncertainty and Privacy Protection

Credit risk assessment is an important process in bank financial risk management. Traditional machine-learning methods cannot solve the problem of data islands and the high error rate of two-way decisions, which is not conducive to banks’ accurate credit risk assessment of users. To this end, this paper establishes a federated three-way decision incremental naive Bayes bank user credit risk assessment model (FTwNB) that supports asymmetric encryption, uses federated learning to break down data barriers between banks, and uses asymmetric encryption to protect data security for federated processes. At the same time, the model combines the three-way decision methods to realize the three-way classification of user credit (good, bad and delayed judgment), so as to avoid the loss of bank interests caused by the forced division of uncertain users. In addition, the model also incorporates incremental learning steps to eliminate training samples with poor data quality to further improve the model performance. This paper takes German Credit data and Default of Credit Card Clients data as examples to conduct simulation experiments. The result shows that the performance of the FTwNB model has been greatly improved, which verifies that it has good credit risk assessment capabilities.

THE EFFECT OF CREDIT RISK AND BANK-SPECIFIC FACTORS ON FINANCIAL PERFORMANCE OF BANKS LISTED IN INDONESIA STOCK EXCHANGE (IDX)

The banking industry plays an essential role in national and global economy. It is caused by the intermediation function attached to bank as financial institution. Banks run the intermediation role by pooling funds from depositors and distribute them through credit loan. As business entity, banks have business goal, to enhance their financial performance. Banks gain most of their revenue from their main activity, delivering loan to the debtors. In order to give credit, banks have to deal with the inevitable risk coming along that the debtors might not be able to restore the fund. This risk is known as credit risk. The good credit risk management doesn’t assure the good financial performance. Banks have to fulfill another specific-factors in order to achieve good financial performance. Those factors are effectivity and efficiency of the day- to- day operation and interest pricing strategy. This research is conducted to discover how Non-Performing Loan (NPL), Capital Adequacy Ratio (CAR), Operational Costs on Operating Income (BOPO), Net Interest Margin (NIM), and Loan to Deposit Ratio (LDR) influence the financial performance of Banks Listed in Indonesia Stock Exchange (IDX). The result found that Non-Performing Loan (NPL) and Loan to Deposit Ratio (LDR) have no effect on Banks Financial Performance, Capital Adequacy Ratio (CAR) and Operational Costs on Operating Income (BOPO) have negative effect on Banks Financial Performance, Net Interest Margin (NIM) has positive effect on Banks Financial Performance. From these findings, it can be concluded that to elevate the profitability, banks have to focus on managing the risk management, efficiency, and pricing decision strategy.

Are private investors overcompensated in infrastructure projects?

Private sector engagement in infrastructure procurement and ownership can have benefits for both investors and society. However, a significant challenge for authorities is determining when private sector participation provides value for money. Private investors may demand high returns on their investments even in projects with seemingly low risks. Governments with good credit ratings and access to lower cost capital may view private investors overprice in comparison to the level of risk they take. This paper examines whether the financing premiums (in addition to the cost of state financing) of four public-private partnership road projects in Finland are reasonable relative to the risks borne by private partners, using long time series of actual data. To the best of our knowledge, this is the first study to mostly use actual ex-post data on project costs over an extended period to evaluate whether the government overpays private investors. Our analysis indicates that the financing cost of the four projects is on average 201 basis points higher than the financing cost the government pays on its debt. We conclude that this premium is reasonable compensation for the risk the private investors bear in the projects. This finding has implications for selecting the most effective procurement policy for road projects.

Strategi Pemberian Kredit dalam Pencegahan Kredit Macet pada PT. BPR Bank Jombang Perseroda

This research aims to develop strategies regarding good credit granting procedures to reduce the occurrence of problem loans at PT. BPR Bank Jombang Perseroda. So this research can be a reference in managing bank management and for consideration in decisions for each activity, especially those related to the distribution of funds. The research method uses documentation, interviews and literature study. The data source in this research is primary data in the form of interviews with several PT employees. BPR Bank Jombang Perseroda, as well as secondary data in the form of annual reports and collectibility at PT. BPR Bank Jombang Perseroda. This type of research is descriptive with a qualitative approach. Data analysis uses the Miles and Huberman model, namely data reduction, data display, and drawing conclusions and verification. Research results: In the discussion that has been explained, the credit distribution activities of PT. BPR Bank Jombang Perseroda goes through several stages and procedures, namely starting with a credit application by filling out a credit application form according to the type of credit being applied for, carrying out a credit feasibility analysis, then deciding whether to approve the credit application or not according to the calculations made, until the disbursement process. There are several factors that are analyzed by financial institutions before approving a credit application, including business prospects, debtor performance and ability to pay. The benchmark for granting credit or the technique for analyzing the character of prospective debtors carried out by Bank Jombang is through the BI Checking process. Apart from that, the things that the bank must consider when granting credit are, Personality, Party, Purpose, Prospect, Payment, Profitability , and Protection.

Does environmental credit affect bank loans? Evidence from Chinese A‐share listed firms

AbstractWe investigate the effect of government‐initiated enterprise environmental credit ratings on firms' bank loans. While prior research indicates that companies with superior environmental performance tend to secure more bank loans, it is crucial to acknowledge that these performance metrics predominantly rely on voluntary corporate social responsibility or environmental, social, and governance disclosures made by the firms themselves or evaluated by third‐party agencies. Consequently, the evaluation results could be biased due to incomplete information disclosure, methodologies, or systems, raising concerns among scholars about potential “greenwashing” or symbolic environmental actions. In contrast, we employ a dataset comprising 27,388 observations from 2009 to 2021, applying propensity score matching and a time‐varying difference‐in‐difference model to better discern the relationship between firms' environmental credit ratings and their ability to obtain bank loans. Our findings highlight that firms participating in environmental credit evaluation can secure more bank loans compared to non‐participating firms. This effect is especially pronounced in regions with advanced green finance development. Further analysis shows that non‐state‐owned enterprises with excellent or good environmental credit ratings receive more loans, thus mitigating ownership bias in loan distribution. Overall, our results demonstrate that mandatory government environmental credit ratings mitigate information asymmetry by enabling lenders to better understand firms' environmental information.

Mekanisme Penilaian Pemberian Kredit Dalam Meminimalisir Risiko Kredit Pada Bank BJB KCP Mojokerto

Bank BJB KCP Mojokerto which is located on Jl Majapahit No. 333C-333D, Kranggan, Mojokerto City is one of the banks that provides credit facilities for the public. This research aims to determine the credit assessment mechanism of Bank BJB KCP Mojokerto in minimizing credit risk. This research uses qualitative methods with observation, interview and documentation techniques. The research results show that bank BJB KCP Mojokerto has implemented good credit assessment using the 5C principles with character and capacity as the bank's main assessment in minimizing credit risk. This research suggests banks improve the risk analysis system, strengthen risk management, strengthen collaboration between the credit assessment department and the risk management department, and provide education to creditors regarding the systematics of credit applications.

Pengabdian Masyarakat Pelatihan Membuat Perjanjian Kredit Barang (Mindring)

Mindring is a business carried out by someone who sells goods using an installment payment system. In the mindring activity itself, it is actually very necessary to have a written agreement between the business actor and the buyer to provide legal certainty to the parties. The method used in carrying out the service is by presenting the material through a lecture, after completing the presentation of the material there is a discussion and question and answer session. Based on the results of the service we carried out, it shows that the implementation of credit for goods (mindring) in villages is still widely carried out by mothers in order to meet the need for household furniture, this is done because the payment system can be done online. However, the problem is that this agreement still uses an oral agreement, where if one day there is fraud or default, one of the aggrieved parties cannot have strong evidence for court proceedings. Therefore, this community service can help residents in the process of crediting goods by making written agreements.

Logistics financial risk assessment based on decision tree algorithm model

In order to solve the financial risk problem of small and medium-sized logistics enterprises, a log algorithm is used to measure the financial risk of logistics. Combined with the actual situation of logistics finance, through the analysis of randomly selected logistics finance data, quantitatively extract important financial risk indicators, build a credit rating model based on decision tree C4.5 algorithm, and conduct empirical research on the model. The empirical results show that the quantitative financial risk indicator extraction method combined with decision tree C4.5 algorithm credit rating model has high accuracy in the evaluation of logistics finance risk. Therefore, based on the existing logistics financial risk assessment methods and models, the decision tree analysis technology is applied to analyze and make decisions on the credit status of credit applicants, and select companies with good credit, so as to reduce the financial risk of logistics enterprises and improve the efficiency of financial risk management.

Pair Tarding and Residual Risk: A Case Study Based on the China’s Securities Firm

With the development of the financial field, there are more and more hedging strategies accompanied by an increasing number of residual risks in these strategies. These risks are generally ignored by people, resulting in losses. This paper begins with CITIC Securities, the leader in China’s securities industry, and analyzes its large-scale paired trading case, spreading spreads in the A-stock market. Firstly, at the macro trading level, this paper finds that there are still credit risks and liquidity risks in the trading of this investment portfolio by referring to the prospectus of CITIC Securities’ bond offering. It puts forward relevant suggestions to reduce these risks. Next, the focus shifts to the analysis of the portfolio strategy itself. The paper identifies four risk points: stock price rise in advance, abnormal events, reduced hedging opportunities, and market irrationality. It also provides suggestions on how to mitigate losses caused by these remaining risks. For example, setting up profit and loss points, establishing relevant departments to control the remaining risk points, maintaining good customer credit, and improving the company’s credit rating.

Good and Bad Credit Growth: Sectoral Credit Allocation and Systemic Risk

Good and Bad Credit Growth: Sectoral Credit Allocation and Systemic Risk

Social credit and corporate risk-taking: Evidence from China

Social credit refers to establishing mutual trust among diverse social entities through adherence to contractual principles. Despite the acknowledged significance of risk-taking in fostering corporate performance, scant attention has been devoted to exploring the influence of social credit on corporate risk-taking. Based on China’s social credit reform policies, we use a staggered difference-in-difference (DID) estimation approach to conduct our study and find that good social credit significantly enhances corporate risk-taking. This phenomenon can be attributed to ameliorating agency costs and alleviating financing constraints. Furthermore, our findings are more significant for firms with weaker corporate governance, higher external financing constraints, and regions with insufficient formal institutions. In conclusion, this study not only expands the research on the influencing factors of risk-taking, but also provides useful references for government departments on how to further improve the construction of social credit system.

Role of Working Capital Management in Enhancing Firm Profitability: An Empirical Study on the Manufacturing Companies of Pakistan

Working capital management is a crucial instrument and one of the key aspects of any business management. It is considered as an accounting technique to maintain the organization's liquidity and financial balance and is regarded as a critical part of financial management in the company. This study emphasizes on investigating the role played by working capital management in enhancing the profitability of companies from the manufacturing sector listed in Pakistan stock exchange during the period 2018-2022. Return on equity and return on assets are used as the profitability measures; however, account receivable turnover, inventory turnover and cash conversion cycle are used as the measures of working capital management. To evaluate the results, the least square regression model is used. The results show that inventory turnover has a significant positive association with both ROA and ROE, which implies that inventory management and sales acceleration have a positive effect on the company's return on assets and return on equity. Similarly, the association of accounts receivable turnover with ROA and ROE is also significant and positive, demonstrating that good credit management and prompt receivables collection improve the return on equity and assets. The research also reveals a significant positive association of both ROA and ROE with the cash conversion cycle. Higher returns on assets and equity are connected with a higher cash conversion cycle. The results suggested that the managers should speed up the collection of receivables as quickly as possible and quickly sell the inventory so that the cash thus generated can be reinvested in productive assets, which can increase the company’s profitability. The study's findings provide an important guideline to financial managers in managing the appropriate level of working capital to enhance firms’ profitability.