The impact of covid-19 pandemic on credit financing of microenterprises and farmer business activity in Poland

Zając, Adam; Wielechowski, Michał; Czech, Katarzyna

doi:10.13166/jms/143524

Cited by 6 publications

(6 citation statements)

References 25 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Stojczew (2021) notes that tourism is one of the first industries that suffered from the pandemic, which was similar to the crisis in 2009. Zając et al (2021) points out that microentrepreneurs and farmers, due to the scale of their activities, are particularly vulnerable to the negative consequences of the pandemic. According to the ongoing analyzes of the financial data of Polish enterprises (Zimny, 2020a), the transport sector suffered the most in Q2 2020, while the trade and manufacturing were less impacted, and the construction and energy sectors showed just a slight decrease in sales and even improved profitability.…”

Section: Literature Reviewmentioning

confidence: 99%

The Impact of Asset Structure on a Company’s Financial Results Stability

Zimny

2022

JoFFL

View full text Add to dashboard Cite

The purpose of the article is to examine the impact of asset structure on the stability of financial results of companies. The article verifies two hypotheses: 1. high share of non-current assets in total assets results in high volatility of profitability over time. 2. high share of PPE (Property, Plant & Equipment) in total assets results in high volatility of profitability over time. The methodology of the study includes a literature review and empirical research based on correlation analysis. The research covered the aggregated data of Polish non-financial enterprises employing 10 persons or more keeping accounting ledgers, data for years 2009–2020 (first dataset) and annual financial data of 115 companies from 13 WSE industry sub-sectors for years 2009–2021 (second dataset). The results of the research. The analysis of the asset structure and the volatility of profitability in the research sample indicated industries with large and small values of these parameters. Then, the hypotheses were tested; the results for the second dataset showed that there is a positive and weak, but statistically significant (p value ≤ 0.005) correlation between non-current asset structure ratio and both, ROS and ROS adjusted ratios, and there is a weak, but negative correlation between PPE structure ratio and ROS and ROS adjusted ratios (with p value of 0.021 and 0.076, respectively). On this basis, hypothesis 1 was considered as verified positively, and hypothesis 2 was rejected. The discussion contains suppositions concerning the probable reasons of the discrepancy between the result for the hypotheses 1 and 2.

show abstract

Section: Literature Reviewmentioning

confidence: 99%

The Impact of Asset Structure on a Company’s Financial Results Stability

Zimny

2022

JoFFL

View full text Add to dashboard Cite

show abstract

“…Unfortunately, in many cases smaller enterprises, which include microenterprises, struggle with liquidity problems in their current operations. Previous studies have identified the impact of the COVID-19 pandemic on microenterprise credit dynamics (Zając et al, 2021). The credit standing of microenterprises for working capital and overdraft facilities is presented in Figure 3.…”

Section: Dynamics Of Loans To Microenterprisesmentioning

confidence: 99%

“…The key factors influencing the demand for credit among enterprises are levels of their economic and investment activity and interest rates (Calza et al, 2003). The COVID-19 pandemic has increased the uncertainty among SMEs in Poland and negatively affected their credit activity and credit availability (Zając et al, 2021).…”

Section: Introductionmentioning

confidence: 99%

Credit situation of microenterprises in Poland – trends and implications

Andrzejak

Weremczuk

Wielechowski

2022

TRR

Self Cite

View full text Add to dashboard Cite

The study aim is to characterise and assess the credit situation of microenterprises in Poland in 2020-2022. We focus on credit dynamics and quality, including total loans, investment loans, working capital loans, and overdrafts. We use monthly data from Polish Credit Information Bureau (BIK). The research covers the period between July 2020 and July 2022. We observe a significant increase in the dynamics of loans granted to microenterprises at the beginning of 2021 and a downward trend in the following analysed months. The fluctuation is similar for investment loans, working capital loans, and overdrafts. We claim that a decrease in the dynamics and interest in loans by microenterprises is not dependent only on the COVID-19 pandemic. A substantial reduction in the value of the Portfolio Quality Index is noticed during the first months of the analysed period (second half of 2020). Then its value stabilizes at a low level. The Index of Portfolio Quality for all analysed industries shows similar values. The analysis results indicate an unfavourable trend that should worry the microentrepreneurs sector and may also negatively affect the entire economy.

show abstract

“…The following are potential sources of credit for micro-enterprises: commercial banks; government institutions; microfinance institutions (MFIs); non-governmental organisations (NGOs); savings and credit associations; and informal credit sources (International Labour Organisation, 2023). However, it is noted that commercial banks normally favour large loans over small ones (Adelekan, et al, 2019;Zaj c, et al, 2021) and have misgivings about the rural poor, particularly women and youths who are classified as high risk clients. On the other hand, in order to enhance micro-enterprises' ability to access formal credit lines, the micro-business owners should increase their financial knowledge (Liu, et al, 2023).…”

Section: Introductionmentioning

confidence: 99%

Deciphering financing models of micro-enterprises in Ruwa, Zimbabwe: Investigating the implications of usury

Chingwaro

2024

IJRP

View full text Add to dashboard Cite

This study focuses on the different financing models employed by micro-enterprises in Ruwa, Zimbabwe, particular emphasis being on investigating implications of usury loans. Pecking Order Theory was adopted as the basis for research objective generation and for literature review on exploration of the financing preferences and sources of finance for micro-enterprises. Qualitative research design was employed wherein in-depth interviews were conducted on 30 purposively selected participants and results show that micro-enterprises in Ruwa heavily rely on informal financing due to lack of formal financial institutions to cater for micro-enterprises unique needs.Micro-enterprises normally resort to usurious loans as a last resort measure, when in emergency and needing working capital. However, these usurious lending practices pose sustainability challenges in the long-run, in the form of suppressed profitability and limited possibilities for growth. Micro-enterprises require full support from government as they provide significant contributions to the economy such as employment generation and poverty reduction, and based on findings of the study, it is concluded that government should at least craft and implement encouraging policies to support micro-enterprises, and formal financial institutions such as commercial banks and microfinance institutions should be flexible enough and reconsider their perceptions on high-risk customers such as micro entrepreneurs. Finally, the study recommends that the government continue to enhance its support on micro-enterprises through capacitation of the already available financial institutions and establishing more financial institutions targeting micro-enterprises especially those run by the youths, women and the rural poor.

show abstract

The impact of covid-19 pandemic on credit financing of microenterprises and farmer business activity in Poland

Cited by 6 publications

References 25 publications

The Impact of Asset Structure on a Company’s Financial Results Stability

The Impact of Asset Structure on a Company’s Financial Results Stability

Credit situation of microenterprises in Poland – trends and implications

Deciphering financing models of micro-enterprises in Ruwa, Zimbabwe: Investigating the implications of usury

Contact Info

Product

Resources

About