Financing Mode Research Articles

Blockchain-Driven Supply Chain’s Financing and Coordination Strategy under Nash Bargaining Scheme

Blockchain-driven supply chain finance (SCF) has become an emerging supply chain financing mode. Compared with the traditional SCF mode, blockchain-driven SCF can shorten the transaction process and provide real trade data that cannot be tampered with, thereby improving the efficiency of capital operation. This article explores the financing and coordination problems of a blockchain-driven supply chain. Based on the three most common supply chain contracts (revenue-sharing contract, profit-sharing contract, and two-part tariff contract), we construct a comparative model of bank credit financing (BCF) and blockchain-driven SCF, discuss the optimal decision-making strategy of the supply chain, and quantitatively analyze the performance of supply chain under each mode. The results show the following: (i) there is a threshold for the usage rate of the blockchain-driven SCF platform; (ii) only when the platform usage rate is lower than the threshold, the blockchain-driven SCF mode which benefits both manufacturer and retailer is a better choice; (iii) the above results always hold if supply chain contracts can coordinate the supply chain in terms of quantity decisions; (iv) the blockchain-driven SCF mode is more efficient for supply chains which are less capital-constrained. This article provides a decision basis for the selection of supply chain financing channels and provides an idea for future research on blockchain-driven SCF.

The Application of Data Mining in Financial Risk Control

In recent years, with the continuous development of Chinese financial market, "supply chain finance mode" has expanded a brand new business within Chinese financial market, but "supply chain finance mode" in the process of business management development, there are still some risk factors. Data mining is a new business information processing technology, which is characterized by the extraction, transformation, analysis and other modeling of a large number of business data in the commercial database, and the extraction of key information to assist business decision. This paper mainly analyzes and studies the repayment risk factors in the operation process of dealers, and uses data mining technology to control the risk factors in the operation process of financial enterprises, so as to avoid a series of risk problems in the operation period of financial enterprises.

Financing and provision of healthcare for two billion people in low-income nations: Is the cooperative healthcare model a solution?

The international consensus in support of universal health coverage (UHC), though commendable, thus far lacks a clear mechanism to finance and deliver accessible and effective basic healthcare to the two billion rural residents and informal workers of low- and lower-middle-income countries (LLMICs). Importantly, the two preferred financing modes for UHC, general tax revenue and social health insurance, are often infeasible for LLMICs. We identify from historical examples a community-based model that we argue shows promise as a solution to this problem. This model, which we call Cooperative Healthcare (CH), is characterized by community-based risk-pooling and governance and prioritizes primary care. CH leverages communities' existing social capital, such that even those for whom the private benefit of enrolling in a CH scheme is outweighed by the cost may choose to enroll (given sufficient social capital). For CH to be scalable, it needs to demonstrate that it can organize delivery of accessible and reasonable-quality primary healthcare that people value, with management accountable to the communities themselves through structures that people trust, combined with government legitimacy. Once LLMICs with CH programs have industrialized sufficiently to make universal social health insurance feasible, CH schemes can be rolled into such universal programs. We defend cooperative healthcare's suitability for this bridging role and urge LLMIC governments to launch experiments testing it out, with careful adaptation to local conditions.

Financing for a Sustainable Dry Bulk Shipping Industry: What Are the Potential Routes for Financial Innovation in Sustainability and Alternative Energy in the Dry Bulk Shipping Industry?

Environmental, regulatory, and economic exogenous disruptions force companies within the maritime shipping industry to become more sustainable. Financing for implementing the necessary changes is particularly challenging for these companies, considering their narrow margins. With the changes in the shipping industry being intrinsically capital-intensive, funding is a particular issue, as few institutional or individual investors can provide the capital required. This paper investigates the challenges of financing. Drawing from the theory of pecking order on debt and equity, it conceptualizes the relation between the modes of financing for the maritime shipping companies and the nature of the disruptions. Initially, we analyze the various IMO decarbonization regulations, GHG emissions, alternative fuels, and green energy. Moreover, the relationship between fleet operation and management and finance is explored. The paper provides a framework to illustrate from a financial perspective the plethora of challenges and disruptions that have troubled the industry. We then recommend more suitable funding routes for companies to gauge the proper mix of equity and debt levels, bonds, and leverage, based on the company’s characteristics, such as size or ESG performance, as analyzed via the lens of corporate financing, along with the nature of the disruption, such as high inflation or geopolitical conflicts. In more detail, the paper focuses on key environmental, social, and governance (ESG) drivers both in the short-term and the long-term within the dry bulk shipping industry: impact investing and ESG factors are driving new investment opportunities and contributing to risk mitigation and long-term investment returns. The most pressing financial and economic questions of the time are wildly extended equity and bond valuations, inflation, and the conundrum most central banks face. Given these uncertainties, from an investment perspective for equity markets, the risk/return outlook for risk assets is skewed to the downside, making a cautious approach prudent for maritime shipping companies.

INFRASTRUCTURE FINANCING IN INDIA: A STUDY OF RECENT INITIATIVES

This article elaborates on the changes that have taken place in the realm of infrastructure investment in India and its mode of financing. In India in the initial stages of development, the Government played a dominant role in infrastructure financing. Today, India gives top priority to the Private-Public Participation mode of financing infrastructure. Considering the importance of infrastructure, new schemes like PM Gati Shakti, the National Infrastructure Pipeline, and National Monetization Pipeline have been introduced by the government to give a fillip to the infrastructure sector in India. All these programs will enrich the ‘Amrit-Kaal’ to take India to the galaxy of developed countries in the world.

On the Ethicality of Islamic Banks’ Business Model

AbstractThis paper scrutinizes the ethicality of Islamic banks’ (IBs’) business model by employing the ‘objectives of Islamic law’ (Maqāsid al‐Sharī’ah). This necessitates developing an ethical framework to construe two primary injunctions of Islamic finance, namely ribā and gharar. The former embodies financial decoupling (aggravating risk‐shifting) and unjust price gouging (provoking economic stagnation and financial exclusion), while the latter involves asymmetric information and excessive risk‐taking behaviour (exacerbating financial fragility and thus systemic risk). We empirically and theoretically illustrate that these unethical issues are still prevalent in the IBs’ modes of financing, despite the Sharī’ah‐compliant endorsement of religious scholars (i.e. Sharī’ah supervisory boards). This affirms that ethicality is merely an impression management exercise of IBs instead of their true business identity. The way forward is to conceptualize IBs’ modes of financing beyond just Sharī’ah compliance by scrutinizing their ethical impact on society at large. This would require updating centuries‐old Islamic rulings (Fatāwā) on financial transactions and consulting finance academics and practitioners.

Analyzing Small and Medium Enterprises’ Perception towards Private Equity as an Alternative Source of Finance in Lusaka District

As guided by the Capital Structure theory, in order to obtain external financing, SMEs may either select debt type of financing or equity type of financing. Since the typical SME cannot meet the requirements to be listed on the Lusaka Stock Exchange, Private Equity remains an attainable source of finance for SMEs who do not want to be financed with debt. This study aimed to analyse the perceptual preference of private equity as an alternative source of financing for SMEs. To meet this objective, an assessment was conducted on the preference of Private Equity to Debt finance. Further, the perception of SMEs towards private equity was explored and themes that influenced the various perception were investigated. A qualitative study was undertaken to meet the above-mentioned objectives. The study employed a grounded theory approach and interviews were used as the primary data collection tool. Fifty-five (55) SMEs who hold accounts with Zambia Industrial Commercial Bank under the Wholesale and Retail trade industrial sector were interviewed and a purposive sampling method was used. From the interviews conducted, the emerging theme was SMEs preferred private equity finance to debt finance mainly in cases where the SMEs interviewed were faced with economic uncertainty, limited collateral, intended to grow quickly, and required technical assistance. However, loss of control, lack of a legal framework and unavailability of Private Equity firms in Lusaka hindered SMEs from utilizing this type of financing. This finding is derived from SMEs preference to Private Equity over debt finance and a largely positive perception SMEs have towards Private Equity finance. Negative perceptions of Private Equity were also noted. This study, therefore, went further to analyse both the factors that influence positive and negative perceptions. These factors included technical assistance, loss of control, payment mechanisms, and duration of the financing methods. The conclusion drawn from this study is that Private Equity is preferred to debt finance because of the lack of high-interest rates and collateral requirements for Private Equity. This study also concludes that there are mainly positive attributes to private equity, though negative perceptions also exist. Loss of control, decision-making concerns, technical assistance, lack of availability of this type of finance, repayment mechanisms, and non-requirement of collateral were noted as factors that were attributed to the conflicting perceptions of SMEs towards Private Equity. Due to this situation, it is recommended that Financial Services Providers take a keen interest in this mode of financing as there is a potential market in this field. Additionally, it is recommended that researchers may focus on conducting a feasibility study to extend the mandate of firms that have been historically providing debt to also include Private Equity Finance for SMEs. Lastly, it is proposed that studies are carried out to assess the legal landscape of Private Equity in Zambia. KEYWORDS:

E-commerce platform financing versus trade credit financing: Financing mode selection for online retailer considering live-stream selling in China.

The rise of live-stream selling has made the e-commerce platform attractive to many small and medium-sized retailers that are often faced with capital constraints. The choice between the e-commerce platform financing (EPF) and trade credit financing (TCF) for the capital-constrained e-retailers engaging in live-stream selling is particularly important problem. This paper considers a supply chain made up of a manufacturer, an e-commerce platform that offers live-stream selling service to consumers and an online retailer with capital constraint. We, respectively, investigate the optimal decisions of the supply chain enterprises under EPF and TCF modes based on Stackelberg game models and optimization theories. We compare the profits of supply chain firms under different cases and obtain some important conclusions through theoretical and numerical analysis. First, when the e-commerce platform's commission rate is low enough, the retailer's ordering quantity is, under EPF mode, greater than that evidenced without capital constraint. In addition, when the retailer's marginal profit is high and the e-commerce platform's commission rate is low, the online retailer should choose EPF mode; in other instances, TCF is its optimal choice. Second, the e-commerce platform can obtain the highest profit under EPF mode, while TCF mode will bring the highest profit to the manufacturer. Third, when the platform's commission rate is below a certain threshold, the profit of the entire supply chain under EPF mode is larger than that of well-funded supply chain, but TCF mode cannot. Finally, we also find there exists the access threshold about the live-stream selling. Only when the commission rate is relatively high, the e-commerce platform should offers live-stream service to consumers and the live-stream investment is the highest under EPF mode.

Research on risk assessment of blockchain-driven supply chain finance: A systematic review

Recently, blockchain-driven supply chain finance has been used in the scope of risk management to solve the financing problem of small and medium-sized enterprises. Among them, risk assessment is the core part of risk management. Therefore, this paper aims to review and analyze articles associated with risk assessment based on blockchain-driven supply chain finance mode. This research also aimed to provide the best practices and identify the academic challenges, motivations and recommendations related with the research. In addition, a methodological approach followed in previous research in this domain was discussed to give some insights for future comers with what to expect. Therefore, articles related to risk assessment based on blockchain-driven supply chain finance were searched systematically. The search was conducted on five major databases, namely, ScienceDirect, Scopus, Web of Science, Springer, Emerald from 2016 to 2022. These indices were considered sufficiently extensive and reliable to cover the scope of the literature. Articles were selected on the basis of the inclusion and exclusion criteria (n = 90). All these articles form a coherent taxonomy, describing the corresponding current views in the literature according to three main categories. The research is considered a major topic which warrants attention. This study emphasizes the current research positions and opportunities in this field and promotes the understanding of this research field.

Case Study of Ant Group's "Double Link" Financing Based On Blockchain Technology

Through the investigation of the representative enterprises of supply chain finance, the operation and service mode, development status and development bottleneck of supply chain finance are analyzed. The "blockchain + supply chain financing" mode of Ant Group is discussed at the theoretical level by taking the "double link" financing mode as an example, and the underlying framework is built with the help of blockchain technology. Enable supply chain finance service providers to establish a comprehensive service platform for all participants in the supply chain, and solve the difficulties of supply chain finance in supporting the financing of small and medium-sized enterprises through the combined application of multiple functional modules, sum up experience, and put forward optimization ideas and strategies. In order to enrich the research content of supply chain financing optimization and innovation, and improve the theoretical system of "blockchain + supply chain financing".

Asymmetry Effect of Tax and Public Debt on Private Consumption Spending in Russia

According to the Ricardian Equivalence theory, private consumption spending is unaffected by the debt vs tax mode of deficit financing. The study re-examines the “Ricardian Equivalence” hypothesis in Russia by using private consumption spending as the dependent variable and government expenditure, government borrowing, tax, and income as the independent variables. The Ricardian position offers an intriguing issue in the Russian setting. If the Russian economy exhibits Ricardian equivalence, the private sector will shift its spending habits and boost its savings, rendering the policy reforms ineffectual. The ARDL and NARDL models used yearly time series data between 1988 and 2022. The results refute the Ricardian Equivalence and support the Keynesian perspective that financing the fiscal deficit (debt vs tax) does affect private consumption spending. The estimates support a strong long-run and short-run link between the variables. Estimates confirm that tax and borrowing mode of deficit financing negatively influences Russia’s consumption spending. It shows that short-run disequilibrium converges to long-run equilibrium in the ARDL model at a rate of 85.3% and in the NARDL model at a rate of 28.6%. The study concludes that the deficit financing strategy should be carefully devised and supported. Implementing an expansionary fiscal policy will influence the overall private demand of Russia. A tendency to rely too much on tax and borrowings as a financing technique negatively influences private consumption spending. This study contributes to the pool of literature on “Ricardian Equivalence” and deficit financing by providing new data on how to formulate fiscal policies that are efficient at financing deficits and sustainable by making prudent expenditures without endangering the nation’s private consumption.

Financial innovation of Small and Medium Enterprises in Morocco in the area of energy optimization: State of the art

The Moroccan entrepreneurial ecosystem is composed mainly of small and mediumsized enterprises (SMEs). These SMEs are currently undergoing profound changes after the financial and health crises, characterized by upheavals and uncertainty. This global context has prompted SMEs to be more and more competitive in order to cope with high degrees of turbulence and unpredictability. This requires the adoption of financial innovations and the inclusion of new modes of financing, in order to overcome the constraints of limited access to resources and the problems of undercapitalization that are related to information asymmetry and insufficient guarantees. These enterprises are using financial innovation can help SMEs understand the financing mechanisms available and encourage them to invest in energy efficiency projects. The objective of this work is to draw up an inventory of different techniques of financial innovation put in favor of Moroccan SMEs and adapting financial innovation in Moroccan SMEs can play an important role in optimizing energy consumption. To this end, the entrepreneurial orientation of SME owner-managers aims at adopting innovative financing means, such as Private Equity, Crowdfunding, Business Angeles, Venture Capital and Digital Finance to facilitate their sustainable development.

Acquirer’s Operational Performance and Stability of Islamic Banks: Mediation Role of Market Structure

Merger and acquisition is known as a market expansions strategy. This paper examines several factors associated with M&A namely bank size, intermediary role, modes of financing, bank-specific variables, and macro-economic variables on the operational performance and stability along with the mediation role of market structure for Islamic banks. This paper employs empirical research methods, namely POLS, panel data techniques and SEM to analyse a set of unbalanced panel samples of 10 Islamic banks during 2004Q1 to 2020Q4 from six countries, namely Qatar, Kuwait, Saudi Arabia, United Arab Emirates, Bahrain, and Pakistan. Stata package 14.2 is used to estimate M&A results (5 years pre and 5 years post). The results indicate that M&A improve Post-M&A performance of Islamic banks while stability does not improve. Interestingly, there is no mediation effects of market structure on the relationship between M&A, operational performance, and stability. Policymakers should take into consideration those factors taking M&A decisions considering the role of market structure.

Analysis of the Financing Mode of Small and Medium-Sized Enterprises Under the DC/EP Platform Based on a Comparison with the Traditional Bank Financing Mode

Analysis of the Financing Mode of Small and Medium-Sized Enterprises Under the DC/EP Platform Based on a Comparison with the Traditional Bank Financing Mode

Retracted: The Operation Mode of Agricultural Supply Chain Finance Using Blockchain.

[This retracts the article DOI: 10.1155/2022/3338030.].

Impact of Deficit Financing and Trade Openness on Private Consumption in India

The Ricardian equivalence hypothesis claims that private consumption is neutral to the fiscal deficit and its mode of financing (debt vs tax). The study reinvestigates the Ricardian equivalence hypothesis in India by taking private consumption as the dependent variable, whereas government expenditure, government debt, tax, domestic income, and trade are considered as independent variables. In the Indian context, the Ricardian view raises an interesting point. If the Ricardian equivalence holds in the Indian economy, households alter their spending patterns and consequently increase their savings, making the policy changes ineffective. The autoregressive distributed lag (ARDL) bound testing approach was applied to the annual time series data from 1988 to 2021. The estimates confirm a significant long-run and short-run relationship between the variables; the results reject the Ricardian Equivalence and propound the Keynesian approach that the mode of financing the fiscal deficit (debt vs tax) does matter to the private consumption expenditure. The estimates also assert the long-run relation between trade openness and private consumption spending. The positive and significant coefficient shows that an open economy leads to an increase in consumption, which indirectly supports the Compensation Hypothesis. Given that deficit financing and trade openness have a substantial influence on India’s consumer spending, it can be concluded that expansionary fiscal and liberal trade policies should be carefully devised and supported. This study contributes to the existing literature on the Ricardian equivalence and trade openness by presenting new evidence on designing sustainable fiscal policy by spending wisely without imperilling the country’s consumption expenditure and global presence.

THE PRACTICES OF RUNNING MUSHARAKAH BY ISLAMIC FINANCIAL INSTITUTIONS: THE SHARIAH ANALYSIS

Running Musharakah (RM) is a type of financing in which an Islamic bank becomes a sleeping partner in a client’s business through a contractual partnership (shirkat-ul-'aqd). Islamic banks set a limit on how much money a client can withdraw immediately or on an “as and when needed” basis. It is now widely used by Islamic banks in Pakistan, who claim it to be a shariah-compliant product and an ideal mode of financing for Islamic financial institutions. However, the opponents claim that the RM product is not Shariah-compliant. There have been numerous scholarly discussions and criticisms of Running Musharkah’s products and practices. As a result, this study examines Running Musharkah (RM) as practiced in Pakistani Islamic banks to determine its Shariah permissibility or impermissibility. The study delves into the history, legitimacy, and rationale for introducing RM alongside financing arrangements used by Islamic banks, and enumerating the dubious points of RM as a shariah-compliant product through a qualitative research approach. The article primarily analyzes the background, legitimacy, and rationale for introducing RM as a Shariah-compliant product through a qualitative research approach, and the dubious points of RM as a Shariah-compliant product. Keywords: Running Musharkah, Running Finance, Shariah, Islamic Banking DOI： https://doi.org/10.35741/issn.0258-2724.58.1.51

Study on Financing Mode of Forest Park in Underdeveloped Areas of Western China

Study on Financing Mode of Forest Park in Underdeveloped Areas of Western China

Strategic Application of Cost Management in Internet Finance Mode

Strategic Application of Cost Management in Internet Finance Mode

Platform Financing Vs. Bank Financing: Strategic Choice of Financing Mode Under Seller Competition

Platform Financing Vs. Bank Financing: Strategic Choice of Financing Mode Under Seller Competition