Loan Supply Research Articles

The low odds of poor women with small business loans emerging from poverty: Critical social policy implications for Pakistan

AbstractThe government of Pakistan has been relying on the microfinance industry to reduce poverty among poor women in Pakistan. Using a theoretical framework that argues for limiting the abilities and capacity of existing microfinance services, we empirically investigate the odds of poor women remaining in poverty despite microfinance loan provision. We collected data from four provinces in Pakistan and analyzed it using multivariate logistic regression. Three‐fourths of the 442 women respondents live below poverty lines and are unable to emerge from poverty due to factors such as: housing instability, food insecurity, lack of savings, insufficient loan size and high installment rates, lack of gender solidarity through group borrowing, and threats of domestic violence. Lack of health insurance and critical health problems such as infectious diseases, having suffered an injury, chronic ailments, and mental health challenges are also preventing poverty emergence. We conclude by recommending key social policy development agendas that need to be introduced by the state, in partnership with the microfinance sector, to support women borrowers and help them emerge from poverty.

Analyzing the determinants of agricultural credit accessibility for farmers in flood-prone regions

Agricultural finance is essential for farmers in flood-prone regions because it offers them access to the money they need to keep their crops running. Crop losses, property damage, and other unforeseen expenditures are quite likely for farmers in flood-prone locations. The provision of agricultural loans is crucial in allowing farmers to minimise these risks and ensure the continuation of their farming operations. The variables affecting farmer’s access to agricultural loans in a Pakistani region in danger of flooding are examined in this research. A structured questionnaire was utilized to gather information from one hundred and sixty-eight subsistence landowners in Khyber Pakhtunkhwa, Pakistan, using a multistage sampling method. According to empirical findings using a subjective slightest squares regression model with vigorous typical errors that accounted for heteroscedasticity, monthly income, family size, education, farming experience, total landholding, and the percentage of owned land were all important determinants of a farmer's ability to acquire loans. The results of this research show that socioeconomic determinants are very important for farmers' access to agricultural loans in Pakistani flood-affected regions. As a consequence, a credit policy is necessary to tackle the issues encountered by farmers who live in dangerous areas. Additionally, the present financing strategy may be altered to defend the rights of occupant cultivators who require security.

The Bank lending channel and sovereign risk: Effects on significant and less significant banks after the implementation of the Banking Union

The Banking Union (BU) has given rise to the distinction between two types of banks, significant banks and less significant ones. This distinction may have produced asymmetries in the transmission of monetary policy, which has not been analysed by the previous literature. This paper tries to fill this gap in the literature by analysing the differences that monetary policy changes have on the loan supply of significant and less significant banks. Our sample consists of banks from the euro area and spans 2014 to 2020. Our empirical model, which is based on the System Generalized Method of Moments (System-GMM) methodology, regress the loan supply growth of each bank on monetary policy and sovereign risk indicators, significant and less significant banks dummies, and a group of control variables. Our results show that, although the BU may have well contributed to a smoother transmission of the monetary policy through the bank lending channel, there are still differences in how monetary policy changes affect the loan supply of significant and less significant banks. The different behaviour of the bank lending channel is observed mainly in countries with low sovereign risk, where the bank lending channel is only effective reducing the loan supply of less significant banks. Our results indicate that greater banking integration is necessary in the euro area.

Perlindungan Hukum Bagi Nasabah Dalam Perjanjian Pinjaman Uang Melalui Aplikasi Pinjaman Online

The presence of the fintech industry in offering digital-based financial products seems to open new doors for people who want to apply for loans. online loans that can be submitted very easily and without complicated requirements. Unfortunately, behind the convenience and practicality it offers, not a few people use this online loan product unwisely. As a result, risky customers have to pay debts greater than the initial agreement. In addition, customers also have to pay late fee fees and other fines which incidentally do not make sense. The problem in this thesis is: How is the implementation of a loan through an online loan application? and What is the form of legal protection for money loan customers through the Online Loan application.In discussing the problem, the researcher took a juridical-normative and empirical-juridical approach, using two types of data, namely secondary data and primary data, collecting secondary data by conducting literature studies and primary data by conducting interviews, then analyzed qualitatively.Based on the results of the research and discussion it was concluded that: 1. Provision of money loans through online loan applications Online loan providers must be in the form of legal entities, online loan service providers must also be registered and obtain permission from the OJK. 2. Legal protection for victims of misuse of personal data in online loans can be resolved through litigation or non-litigation. If the problem is resolved through non-litigation, the victim can complain about the problem to the OJK. Then OJK will give administrative sanctions which are regulated in Article 47 POJK No.77/POJK.01/2016.

The implementation of IFRS9 in Gulf banks: using the GMM and the difference-in-differences with multiple time periods approaches

Purpose This paper aims to examine the impact of the mandatory adoption of (International Financial Reporting Standards [IFRS] 9) on loan provisions, nonperforming loans (NPL) and impairment loan loss in Gulf banks. This study also investigates potential variations in outcomes compared to prior models and explores the use of the Callaway and Sant’Anna (2021) estimator for difference-in-differences (DiD) with multiple time periods. Design/methodology/approach The research is based on a sample of 53 Gulf banks covering the period from 2012 to 2020. The study analyzes the changes in loan provisions, impairment loss and NPL following the implementation of IFRS 9. It uses statistical analysis and the DiD method to compare the outcomes between the experimental group (treated by IFRS 9) and the control group (not treated). Findings The findings reveal a statistically insignificant increase in loan provisions, impairment loss and NPL after the adoption of IFRS 9. These results align with previous studies and suggest that Gulf banks were proactive in anticipating and mitigating the impact of the new standard. The study also observes a synchronization of provisioning practices across Gulf countries and a certain level of consistency in recognizing loan losses. Practical implications The practical implications of this study suggest that Gulf banks have successfully absorbed the impact of IFRS 9 and have implemented collaborative approaches. Originality/value The study offers some new sight into IFRS9 outcomes in developing countries and opens the door for implementing a novel DiD estimation in future research studies.

Dynamic framework for strategic forecasting of the bank consumer loan market: Evidence from Ukraine

Accurate forecasting of consumer loan market behavior gives banks a huge potential to optimize their credit strategies by proactively adapting to external changes. This study aims to analyze and predict consumer loan demand, supply, and profitability in the Ukrainian banking sector. Using a systemic dynamic approach, the interplay of five key factors is considered: central bank policies, GDP fluctuations, changing competitive landscape driven by FinTech companies, investment in government bonds as an alternative to loan granting, and severity of credit risk management.The developed dynamic model for the bank consumer loan market in Ukraine offers predictive capabilities enhancing decision-making and strategic planning in the banking sector and can be adapted in open small economies. Within the proposed systemic dynamic model, five scenarios were explored. Compared to the base scenario, a 4 p.p. increase in the key policy rate results in UAH 4.7 billion decrease in demand for bank consumer loans and a UAH 0.55 billion reduction in lending profitability based on the year’s results. Fall in GDP by 6 p.p. leads to a decrease in the supply of bank consumer loans by UAH 6.9 billion and a decrease in lending income by UAH 1.3 billion based on the year’s results. Scenario with the decline of FinTech portfolio by 20 p.p. quarterly leads to an increase in demand for bank consumer loans of UAH 8 billion. A 4 p.p. rise in government bond yields leads to a UAH 17 billion reduction in the supply of consumer loans in the same quarter.

Gender Disparity in Real Estate Investment: A Case Study of the Staff of the Federal University of Technology Akure, Nigeria

Women have unparalleled strength and an unwavering passion for success and accomplishment. This is evident in the involvement and contributions of women in many professions, including academia. Nevertheless, women participation in real estate investment has been considerable despite the importance and benefits of real estate investment. In view of this, this paper examined gender disparity in real estate investment among the staff of the Federal University of Technology, Akure (FUTA), Ondo State, Nigeria with a view to encouraging more women participation in real estate investment. FUTA staff (junior and senior cadres) were the target populations while structured questionnaires were randomly administered on the staff. Cross tabulation, correlation analysis, and Mann Whitney U Test were used to analyze the data collected. The study revealed that the percentage of males in active service in FUTA is about twice that of females and men significantly outperform women in real estate investment in FUTA. The study also showed a statistically significant relationship between gender and real estate investment at p value ≤0.05 thus identifying gender as a factor influencing real estate investment while there are also significant differences in the opinions of the males and female staff regarding real estate investment decision. The study concluded that gender has a significant impact on real estate investment and therefore recommended the sensitization of staff on the importance of real estate investment, provision of loans, mortgages as well as salary reviews without any form of discrimination so as to encourage real estate investment and allow for adequate retirement plans.

Differences in Saving and Investment between Men and Women in Luwinga Ward Mzuzu City, Malawi

Saving and investment are important and required for a society. Therefore, this study was conducted to assess the differences in saving and investment between business and working men and women of Luwinga Ward, Mzuzu City. Sample of 100 men and women participated in a structured questionnaire survey. Descriptive statistics was used to analyze the differences that men and women have on the preferences of type of saving and assets ownership. The logistic binary regression was used to determine the factors influencing the saving behavior of men and women. The results showed that gender moderate preferences of saving avenues and asset ownership. There were gender disparities in savings and assets ownership in which men were having long-term savings and also were owning more financial assets compared to the women. It was found that saving behavior between men and women significantly determined by source of income, sex, Marital status, age and education level. The paper recommends the provision of financial literacy and capacity development in making investment decision to women and youth. The paper also recommends economic empowerment through provision of low-interest loans to youth and women to boost their saving and investment behavior. This paper has policy impact in narrowing down gender differentials between men and women in making saving and investment decision that favours national development.

The impact of open banking on traditional lending in the BRICS

This study examines the influence of open banking regulation on traditional bank loans in the emerging markets of the BRICS—Brazil, Russia, India, China, and South Africa. Utilizing bank-level and individual-level data, the paper reveals that the introduction of open banking significantly diminishes consumer loan lending by traditional banks. Additionally, consumer propensity to acquire loans from traditional banks decreases. The research provides empirical evidence of how open banking impacts both the supply and demand sides of individual loans from traditional banks. This paper contributes to the literature by highlighting the unique role of open banking in promoting financial inclusion in emerging economies.

Komparasi Algoritma Naïve Bayes Dan Support Vector Machine (SVM) Untuk Klasifikasi Kelayakan Pemberian Pinjaman

Cooperatives are social organizations or economic bodies that have a very important role in the growth, development of economic potential and community success. One of the cooperative activities is the provision of credit or loans to community members. Cooperative credit is one of the most important banking activities and serves to provide credit to the community. In practice, errors often arise due to inaccurate credit analysis, or the behavior of the customers themselves. The purpose of this research is to compare the accuracy results between the Naive Bayes algorithm and Support Vector Machine (SVM), where the best accuracy results can later be used as a reference to determine the profitability of lending. The attributes used in this study consist of 11 attributes, namely: Gender, marital status, occupation, relatives, nominal income, income criteria, loan amount, loan term, interest rate, installments and class as income characteristics. The dataset used in this study includes 166 members of the Daru Nahdla Capita Shari'ah cooperative. The results of testing the naive bayes algorithm after dividing the data five times, dividing the data set 70% as test data and 30% as training data, obtained a precision value of 97.00%, recall 100.00%, F1 score 99.00%. and accuracy 98.00%. Thus, the Naive Bayesian algorithm is an algorithm that shows accurate classification and prediction

Speed for Safety: The Establishment of Bankruptcy Courts and Bank Credit Risk in China

Abstract We investigate the effect of bankruptcy court establishment on the credit risk of municipal commercial banks in China from 2013 to 2020. Establishing bankruptcy courts reduces the non-performing loan ratio of municipal commercial banks. The effect is more pronounced in cities with low fiscal transparency and market fragmentation, and a strong rule of law. Furthermore, we argue that the bank’s loan provision and provision coverage ratio is the crucial intermediate variable in the relationship between bankruptcy court establishment and credit risk management. Our findings demonstrate the critical role of judicial system reform in promoting financial stability in China. JEL classification numbers: G21, G32, G33. Keywords: Bankruptcy court, Credit risk, Judicial reform.

Tax Incentives and Maturity Mismatch between Investment and Financing: Evidence from China

AbstractThis paper examines the effects of China's accelerated depreciation policy (ADP) on the maturity mismatch between investment and financing. Using panel data for China's A‐share nonfinancial listed companies from 2010 to 2019 and a staggered difference‐in‐differences approach, we found the following. First, ADP significantly aggravated the degree of corporate maturity mismatch, and this result was robust across multiple checks. Second, due to an insufficient long‐term loan supply, firms had to finance the fixed investments induced by ADP with short‐term debts, leading to maturity mismatches. Third, the positive policy effects were mainly significant for firms with high policy exposure, high‐risk preferences, a high degree of information asymmetry, and firms with weak long‐term financing capacity. Finally, maturity mismatch exacerbated corporate financial risks. Our research findings indicate that passive maturity mismatch is prevalent among Chinese companies and emphasize the need to address financial repression in order to mitigate the potential financial risks that may arise from tax incentives.

Quantitative Easing and bank risk-taking behavior

In this paper, we examine the effect of reserve creation due to the Federal Reserve's Large-scale Asset Purchase programs on bank lending and risk-taking behavior. In particular, we test the existence of a risk-taking channel that induces banks with higher reserve accumulation due to the Fed's policy to increase the share of riskier loans. Exploiting the heterogeneity in the exposure to such asset purchase programs, as measured by relative mortgage-backed securities holdings in the banks' portfolios, we use difference-in-differences analysis to study the effect of the Fed's policies on the supply of total loans and the share of riskier loans such as real estate, commercial and industrial, and consumer loans. We find that the first and third round of Quantitative Easing (QE) policies led to an increase in both the total loans and the share of riskier loans within the banks' portfolios, supporting the risk-raking channel. The second round of QE on the other hand, had no significant impact on banks' lending behavior.

Why Does the Yield Curve Predict GDP Growth? The Role of Banks

We provide evidence on the effect of the slope of the yield curve on economic activity through bank lending. Using detailed data on banks' lending activities coupled with term premium shocks identified using high-frequency event study or instrumental variables, we show that a steeper yield curve associated with higher term premiums (rather than higher expected short rates) boosts bank profits and the supply of bank loans. Intuitively, a higher term premium represents greater expected profits on maturity transformation, which is at the core of banks’ business model, and therefore incentivizes bank lending. This effect is stronger for exante more leveraged banks. We rationalize our findings in a portfolio model for banks.

Some implications of the neoliberal massification of Colombian HE for achieving the sustainable development goals

This article draws on existing research, including publicly available data, to identify changes in Colombian HE which have led to its progressive massification and neoliberalisation. These include the introduction of standardised testing; endogenous and exogenous privatisation (Ball and Youdell, 2007); the expansion of the country’s non-income contingent loan scheme; cost-cutting and cost-sharing; and the Government of Colombia’s prioritisation of technical and technological (T&T) education. The article then explores some implications of this neoliberal massification of Colombian HE for the achievement of the UN’s sustainable development goals in general and more specifically Sustainable Development Target 4.3, which is the only target to explicitly reference inclusion in HE. The analysis suggests that although some neoliberal policies may have broadened access to HE for some Colombians from low-income and rural backgrounds, they are not consistent with a sustainable development agenda. Reasons for this include the large number of student loans recipients who are in arrears; the use of public money to finance students’ courses in private higher education institutions (HEIs); the prioritisation of T&T education which leaves limited room in Colombian HE for the ‘full development of the human personality’ (OHCHR, 2022: article 13.1); and the country’s overreliance on non-renewable resources for its economic prosperity. The paper ends with some proposals for disrupting the ongoing neoliberalisation of higher learning in Colombia such as the replacement of the country’s non-contingent loan scheme with an income-contingent model; improving the efficiency and accountability of state-run T&T programmes; the granting of student loans only for courses at accredited HEIs; the provision of loans to accredited private HEIs only in cases where no public alternative exists; the abolition of tuition fees in public HEIs for the poorest students; the introduction of stipend-supported internships; and the promotion of Civic Education.

Contracts for the purchase of affordable housing: concepts, legal nature and features

In Ukraine, the right of individuals – citizens to housing is constitutionally enshrined, which can be realized both by purchasing such an object of civil relations in ownership and in use. As of today, the issues of providing housing for the citizens of Ukraine have become particularly acute due to the fact that many of them lost it due to the criminal war against our state. These issues have become especially relevant due to the declaration of our state as a social state, because under such conditions, Ukraine must help its citizens to acquire rights to this category of property. For some reason, as of today, the most common basis for acquiring housing rights is the contract itself, which remains unique means of regulating legal relations in European private law.
 The concept of housing in Ukraine is provided in a number of normative legal acts of various levels of legal force, among which, of course, the Civil Code of Ukraine and the Housing Code of Ukraine that occupy a special place. Affordable housing is built and those being built with state support, residential buildings (complexes) and apartments. State support for the construction of affordable housing consists in the payment by the state of 30 percent of the cost of construction (purchase) of affordable housing and/or the provision of a preferential mortgage housing loan.
 Contracts for the purchase of this category of housing are sales contracts, that is, they belong to the group of transactions on the transfer of property into ownership. At the same time, by their legal nature, these are consensual, paid, bilateral and fixed-term (usually up to 12 months). In the case of investing in objects of unfinished construction, under certain conditions, such contracts may have a risky nature. Also, it is worth noting separately about: the specific subject composition of these contracts, the obligation to comply with the requirements regarding their form and specifics of execution.

TSUKAMOTO FUZZY IN OPTIMIZING THE CREDITWORTHINESS ASSESSMENT PROCESS AT SAVINGS AND LOAN COOPERATIVES

Savings and Loan Cooperatives are ones of the non-bank institutions whose business activity is the provision of loan. In its business activities, problems often arise, namely non-performing loans which causes no turnover of funds which leads to losses. One of the causes of non-performing loans is the lack of objective creditworthiness assessment. The purpose of this study is to optimize the process of assessing the feasibility of loan applications at Savings and loan credit with assessment criteria: loan value, total income, loan term and collateral value. The tsukamoto fuzzy method was used in this study. Tsukamoto fuzzy method consists of four steps.: fuzzification, Forming fuzzy rules, application of implication functions using the MIN function and defuzzification using the weighted average calculation method. In this research, it was found that Tsukamoto's fuzzy method can be applied to the creditworthiness assessment process at the Saving and Credit Cooperatives. This is because the accuracy rate of the decision results from the tsukamoto method is 93.75%. A total of 60 data out of 64 data are in accordance with the eligibility decision at one of Saving and loan Cooperatives in West Java, Indonesia. Tsukamoto fuzzy method can optimize the credit assessment process in Savings and loan Cooperatives because the eligibility assessment process becomes more efficient and objective.

ANALYSIS OF POVERTY STATUS AMONG FARMING HOUSEHOLDS IN CENTRAL ZONE OF PLATEAU STATE, NIGERIA

This study examined the poverty status of farming households in Central Zone of Plateau State, Nigeria. A multi-stage sampling procedure was used in selecting the respondents. Data were collected through the use of structured questionnaire and were analysed using both descriptive (percentage and mean) and inferential statistics (Foster, Greer and Thorbecke and Logistic regression). The results revealed that the mean age of the respondents was 40 years, most of the respondents were married with an average number of 5 persons per households, and relatively low-income level but well educated, it was also confirmed that the average annual income of the respondents was ₦148,855 generated as a result of relatively large farm sizes as indicated by the average farm size of 3.8ha. The finding further reveals that inadequate government support, non-accessibility to improved seeds alongside poor road network/reserves and inadequate healthcare facilities were the major causes of poverty among the respondents. The poverty status was found to be at a moderate poverty line with (2/3 MPCI) of ₦99,236.36 and a core poverty line (1/3 MPCI) of ₦49,618.18, while the poverty incidence and severity were found to be at 0.505 and 0.299 respectively. Some of the major constraints identified in the study area were; inadequate access to funds, security issues and inadequate seminars/workshops. Emanating from the findings it can be concluded that the factors influencing poverty statutes of the farming households were income, education level, age, household size and farming experience. Based on the constraints highlighted the study recommends, the need for government and other relevant stakeholders such as financial agencies and non-governmental organizations to provide support through provision of loans, grants, trainings and seminars on the use of novel technologies in agriculture to foster and boost production among the farming households most especially in the rural settlements.

Development Trends of the Market of Agricultural Lending to Households in Ukraine: Analysis of Consumer and Mortgage Loans

The purpose of the article is to assess the conditions and identify the features of the market for consumer and mortgage lending to households based on the economic and statistical analysis of the data panel. The instrumental and methodological apparatus of the article compiled general scientific principles and approaches to economic analysis: Scientific abstraction, analysis and synthesis, grouping, typology, comparison, qualitative and quantitative expert assessments; logical and contextual methods of processing theoretical material, as well as the method of economic and statistical comparisons. The article analyzes the dynamics of consumer and mortgage loans for households in Ukraine from 2007 to 2023, and highlights their socio-economic significance. The main problems in the field of consumer lending are formulated, the resolution of which is necessary for the intensive agricultural activity of households. It has been established that, despite the accumulation of certain experiences in the banking sector, the mortgage lending market has not become massive today. It is concluded that the reasons for this situation are the difficulty in the practical application of legislative regulations aimed at protecting the interests of creditors; high level of interest rates; low level of real income of households and, consequently, low effective demand for mortgage loans; the impossibility of mass provision of long-term mortgage loans due to high risk (interest, credit, legislative); almost complete exclusion of the state from participation in the formation of a civilized market for housing mortgage lending. The prerequisites for the further development of consumer and mortgage lending to households in Ukraine are formulated. The prospects for development and the main directions for improving consumer and mortgage lending to households are determined.

PERCEPTION OF SASIRANGAN FABRIC ENTREPRENEURS IN SASIRANGAN VILLAGE, BANJARMASIN CITY ABOUT SHARIA-BASED BUSINESS CAPITAL LOANS

This study aims to describe the knowledge of Sasirangan cloth entrepreneurs in Sasirangan Village and their perceptions of sharia-based business capital loans. This type of research is a field research with the character of a case study, which is a research carried out by the author directly going to the research location to get the necessary data. This research is descriptive in nature, namely research that seeks to describe existing problems based on data from interviews with informants and analyzes these data. Data analysis used is data collection, data reduction, data display and drawing conclusions. Furthermore, the data that has been analyzed, explained and interpreted in the form of words to describe the facts in the field, the meaning or to answer research questions which are then taken from the essence. Based on the results of the study, it can be concluded that the knowledge of Sasirangan cloth entrepreneurs in Sasirangan Village towards sharia-based business capital loans is still divided into 3, namely: (1) fairly knowledgeable about providing sharia-based business capital loans, (2) not knowing about providing capital loans. sharia-based business, and (3) very little knowledge about the provision of sharia-based business capital loans The perceptions of Sasirangan cloth entrepreneurs in Sasirangan Village towards sharia-based business capital loans are also diverse, namely: informants who have a good view of providing sharia-based business capital loans because they are banking based on Islamic principles in their management and informants who view that Islamic and conventional banking according to they are the same, meaning they both flower in borrowing.