Determinants of access to formal credit by the industrial and constructional small and medium enterprises in Can Tho city, Vietnam

Vuong Quoc Duy *

* Corresponding author (vqduy@ctu.edu.vn)

Article Sidebar

Full Text: PDF

Received: 20 Aug 2015
Revised: 08 Oct 2015
Accepted: 19 Feb 2016
Published: 28 Feb 2016
DOI: 10.22144/ctu.jen.2016.009
Views
205
Downloads
74
Crossref
Scopus
Google Scholar
Europe PMC
How to Cite
Vuong, Q. D. (2016). Determinants of access to formal credit by the industrial and constructional small and medium enterprises in Can Tho city, Vietnam. CTU Journal of Innovation and Sustainable Development , (02), 112-121. https://doi.org/10.22144/ctu.jen.2016.009
Issue
No. 02 (2016)

Main Article Content

Abstract

The studies “Determinants of access to formal credit of industrial and constructional Small and Medium Enterprises (SMEs) in Can Tho City of Viet Nam”. The study used primary data from 200 industrial and construction SMEs in the Can Tho City in 2013. Using the Probit model, the findings have showed that three factors including number of operational years in business of the enterprises, the scale of enterprises and the enterprises’ revenue growth rates are statistically significant affect on the ability to access credit by SMEs. The results implied possible solutions to improve the possibility to access to formal credits industrial and constructional SMEs given by financial institutions, to assist the Enterprises to invest and widen their production and performance.
Keywords: Credit, SMEs, Industry, Construction, Can Tho

Article Details

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

References

Adler, P.S., Kwon, S.W., 2002. Social capital: Prospects for a new concept, Academy Management Reviews. 27: 17-40.

Atieno, R., 2001. Formal and informal institutions’ lending policies and access to credit by small-scale enterprises in Kenya: An empirical assessment, AERC Research Paper 111, African Economic Research Consortium, Nairobi November 2001.

Aubert, C., de Janvy, A., Sadoulet, E., 2009. Designing credit agent incentives to prevent mission drift in pro-poor microfinance institutions, Journal Developmeny Economic. 90: 153-162.

Balogun, O.L., Yusuf, S.A., 2011. Determinants of Demand for Microcredit among the Rural Households in South-Western States, Nigeria, Journal of Agriculture and Social Sciences. 7: 41-48.

Battilana, J., Dorado, S., 2010. Building Sustainable Hybrid Organizations: The Case of Commercial Microfinance Organizations, Academy of Management Journal. 53: 1419-1440.

Canh, N.T., 2008. Possibility to access to enterprises finance of Small and Medium Enterprises in Vietnam. The journal of economic development, N0. 212.

Clement, O.N., 2009. Asymmetry Information Problem of Moral Hazard and Adverse Selection in a National Health Insurance, Management Science and Engineering. 3: 101-106.

Coleman, J.S., 1988. Social Capital in the Creation of Human Capital, American Journal Social. 94: 94-120.

Diagne, A., Zeller, M., Sharma, M., 2000. Empirical Measurements of Households' Access To Credit And Credit Constraints In Developing Countries: Methodological Issues And Evidence, International Food Policy Research Institute. Washington, D.C. U.S.A.

Ellis, F., 2000. Rural livelihoods and diversity in developing countries., Oxford, Oxford University Press.

Greene, W.H., 2008. Econometric Analysis, in 6th ed. ed. New Jersey: Prentice Hall.

Grootaert, C., Oh, G.T., Swamy, A., 2002. Social capital, household welfare and poverty in Burkina Faso, Journal African Economic. 11: 4-38.

Gujarati, D.N., Porter, D.C., 2009. Basic Econometrics, Fifth Edition. Mc Graw Hill, New York. .

Heckman, J.J., Ichimura, H., Todd, P., 1998. Matching as an econometric evaluation estimator, Reviews Economic Studies. 65: 261-294.

Hoff, K., Stiglitz, J.E., 1990. Imperfect Information and Rural Credit Markets - Puzzles and Policy Perspectives - Introduction, World Bank Economic Review. 4: 235-250.

Jain, P.S., 1996. Managing credit for the rural poor: Lessons from the Grameen Bank, World Development. 24(1): 79-89.

Kebede, S.N., Abera. N., 2014. Determinants of Micro and Small Enterprises’ Access to Finance. Developing Country Studies. 4(21): 90-103.

Kokko, A., Sjo’holm, F., 2004. The internationalization of Vietnamese SMEs. Stockholm school of economics, Asian Economic Papers. Vol. 4 (1).

Kumar, A., Francisco, M., 2005. Enterprises, Financing Patterns, and Credit Constraints in Brasil: Analysis of Data from the Investment Climate Assessment Survey. Washington, D.C.: World Bank.

Morduch, J., 2000. The microfinance schism, World Development. 28: 617-629.

Mukiri, W.G., 2008. Determinants of Access to Bank Credit by Micro and Small Enterprises in Kenya. Growing Inclusive Markets Conference 2008.

Nghi, N.Q., 2011. Possibility access to subsidized credit for Small and Medium Enterprises in Mekong Delta. The journal of Monetory Financial Market, N0. 19.

Nikaido, Y., Pais, J., Sarma, M., 2012. Determinants of Access to Institutional Credit for Small Enterprises in India, Working Paper, Social Science Research Network, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2035663.

Nkuah, J.K., Tanyeh, J.P. Gaeten, K., 2013. Financing small and medium enterprises in Ghana: Challenges and determinants in accessing bank credit, International Journal of Research In Social Sciences Vol. 2, No.3 Available from: http://pascal.iseg.utl.pt/~aafonso/eif/pdf/crrinf81.pdf (accessed on 20th Oct. 2013)

Omonona, B.T., Akinterinwa, A.T., Awoyinka, Y.A., 2008. Credit Constraint Condition and Output Supply of COWAN Farmers in Oyo State, Nigeria European Journal of Social Sciences. 6: 382-390.

Przeworski, A., Vreeland, J.R., 2000. The effect of IMF programs on economic growth, J. Dev. Econ. 62: 385-421.

Rhyne, E., 1998. The Yin and Yang of Microfinance: Reaching the Poor and Sustainability”, The Micro banking Bulletin, 2.

Schaffner, J.A., 2002. Heteroskedastic sample selection and developing-country wage equations, Review Economic Statistics. 84: 269-280.

Schafgans, M.M.A., Zinde-Walsh, V., 2002. On intercept estimation in the sample selection model, Economet. Theory. 18, 40-50.

Schreiner, M., Fontcuberta, M.C., Graham, D.H., Coetzee, G.,Vink, N., 1996. Discrimination in Hire/Purchase Lending By Retailers of Consumer Durables In Apartheid South Africa., Development Southern Africa. 13: 847-860.

Sharma, M., Zeller, M., 1999. Placement and Outreach of Group-Based Credit Organizations: The Cases of ASA, BRAC, and PROSHIKA in Bangladesh, World Development. 27: 2123-2136.

Statistical Yearbook of Can Tho 2013

Vaessen, J., 2001. Accessibility of Rural Credit in Northern Nicaragua: The Importance of Networks of Information and Recommendation, Savings and Development. 25: 5-31.

Vetrivel, S.C., Kumarmangalam, S.C., 2010. Role of microfinance institutions in rural development, International Journal of Information Technology and Knowledge Management. 2: 435-441.

Vreeland, J.R., 2002. The effect of IMF programs on labor, World Development. 30: 121-139.

Woolcock, M.J.V., 1999. Learning from failures in microfinance: What unsuccessful cases tell us about how group-based programs work, American Journal Economic Social. 58: 17-42.

Yehuala, S., 2008. Determinants of smallholder farmers access to formal credit: The case of Metema Woreda, North Gondar, Ethiopia. Master Thesis. Haramaya University.

Zander, R., 1994. Barriers to Credit Access in Rural Sri Lanka, in: F.J.A. Bouman and O. Hospes (eds.): Financial Landscapes Reconstructed: The Fine Art of Mapping Development, Westview Press, Boulder.