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I use a unique data set of loans to small business owners to examine whether lenders face adverse consequences when they grant debt forgiveness to borrowers. I provide evidence consistent with borrowers communicating their debt forgiveness to other borrowers, who then more frequently strategically default on their own obligations. This strategic default contagion is economically large. When the lender doubles debt forgiveness, the default rate increases by 10.9% on average. Using an exogenous shock to the lender's forgiveness policy, my findings suggest that as the lender learns about the extent of borrower communication the lender tightens its debt forgiveness policy to mitigate default contagion. [ABSTRACT FROM AUTHOR]

This study analyzes the economic consequences of changes in the local bank presence. Using a unique data set of banks, firms and counties in Poland over the period 2009–14, it is shown that changes strengthening the relationship banking model are associated with local labour market improvements and easier small and medium-sized enterprise access to bank debt. However, only the appearance of new, more aggressive owners of large commercial banks stimulates new firm creation. [ABSTRACT FROM AUTHOR]

The small and medium enterprises are the pillars of economic development in India. With over 30 million units of SME units in India, they are contributing to 45% in country's GDP. The importance of SMEs in manufacturing is mainly due to the volume of units that exist in this category. Recently government has taken several steps in boosting the manufacturing in India, "Make in India" is one such initiative and National Manufacturing policy has been announced to revamp the sector. One of the major hindrances in expansion is lack of timely and sufficient funds. Today the total gap of SME funding is estimated to be approximately $126 billion. Out of which the debt gap is approximately $84 billion (Ravij Janjanan, 2014). Research is undertaken to know the determinants of credit in Mumbai city which is the financial capital of India. Present paper studied the determining factors of credit in SME sector in Mumbai by applying Binary logit regression model. Data was collected from supply side through administered questionnaire. Factors were identified through focus group interviews and later tested for validity and reliability.Net worth and Age of the owner found to be most impacting factors loan officers are considering while granting credit to SMEs in Mumbai. Study also found that age of the owner is very important determinant along with net worth and financial feasibility. Odds ratio for age of the owner (0.70) of respondents indicate that whose loans are approved belongs to lower age groups than the respondents whose loans are disapproved. Odds ratio for Net worth (1.36) of respondents indicate that one-unit change in the Net worth is going to increase the loan acceptance by 1.36 times. Managerial implications of this study would be Banks can focus on more startup loans and can tap young entrepreneurs who have creative and prospective ideas on business. SME owners should focus more on innovation, clarity of thought expressed in project proposal and approach for loan sanctions at young age to improve the credit flow. [ABSTRACT FROM AUTHOR]

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The recent financial crisis has generated interests in how business cycle affect bank lending to SMEs. However, the effect of the business cycle on lending to SMEs in South Africa after the global financial crisis of 2008 has not been extensively explored. We examine this relationship and its effect in South Africa using Vector Autoregressive modeling. This paper employs monthly data from South Africa Reserve Bank (SARB) for the period 2008 to 2014. We adopt the regulatorydriven capital crunch hypothesis employing monthly data from South African Reserve Bank (SARB). Most of the variables display a very sensitive reaction to the coincident index and capital adequacy shock. The results show strong evidence of procyclicality in SME lending in South Africa. The result shows that business cycle has a positive and significant long-run impact on SME. However, the adjustment coefficient of the business cycle is also positive and significant in the short run. Any case of asset price misalignment or excessive growth boom may ultimately amplify the business cycle. The impulse response test shows the response of bank lending to SMEs to one standard deviation shock of the business cycle is negative and persistent for over 15 quarters before steadying. This result vividly indicates some strong evidence of credit procyclicality between the business cycle and SME in South Africa. Our results have interesting implications for credit availability to SMEs. Our results have several implications. Firstly, these may lead to many banks decreasing lending in bad times when they encounter loan losses and their capitalization drops. This may affect the real economy, as SMEs, which need to finance their small enterprises, may be cut off from credit. There is also a need to promote diversification of financing options for small firms and SMEs by providing various credit supporting policies in South Africa. There is, therefore, an urgent need to boost support to SMEs credit, especially during recessionary periods. [ABSTRACT FROM AUTHOR]

How does the presence or absence of small business loans affect the emergence and development of rural businesses in traditionally underserved areas? Further, how has capital-intensive oil and gas development contributed to these lending patterns? In our ongoing work, we have established that locally oriented businesses such as small manufacturing establishments and retail outlets are associated with many beneficial local outcomes and promote nonmetropolitan community resilience. Using a longitudinal dataset based on annual public disclosures, we employ data on lending in more than 3,000 United States counties to build analytical visualizations. We provide relevant documentation through spatial statistics for future research on small business lending in underserved nonmetropolitan communities. [ABSTRACT FROM AUTHOR]

In this paper we explore the likely implications of the entry of Big Tech platforms into retail banking and the appropriate response of regulators and policy makers to this new industry development. We find that the entry of Big Tech platforms may transform the banking industry in radical ways: although it may possibly increase competition to the benefit of consumers in the short term, within a few years Big Tech companies may succeed in monopolizing the origination and distribution of loans to consumers and Small and Medium Enterprises (SMEs), forcing traditional banks to become "low cost manufacturers," which merely fund the loans intermediated by the Big Techs. This situation may harm competition, reduce consumer welfare, and bring about an increase in financial instability in the medium or long term. We analyze alternative policy responses aimed at maximizing the positive impact on consumer welfare of Big Tech entry while limiting the risk of monopolization as well as the potential adverse implications of such entry on market integrity and financial stability. [ABSTRACT FROM AUTHOR]

The article discusses the impact of U.S. Small Business Administration (SBA) programs designed to provide funding for Black firms. Data were compiled for 286 Black-owned firms in Boston, New York, and Chicago, as well as for a sample of White-owned firms in Boston. Multiple linear regression analysis revealed strong correlation between business net worth and business liquidity for both Black and White businesses. At a fixed level of profits plus depreciation, Black firms qualified for larger loans than White firms. Experience and credit rating appeared to have little impact on loan amounts received by Black firms.

This paper empirically examines how ties between a firm and its creditors affect the availability and cost of funds to the firm. We analyze data collected in a survey of small firms by the Small Business Administration. The primary benefit of building close ties with an institutional creditor is that the availability of financing increases. We find smaller effects on the price of credit. Attempts to widen the circle of relationships by borrowing from multiple lenders increases the price and reduces the availability of credit. In sum, relationships are valuable and appear to operate more through quantities rather than prices. [ABSTRACT FROM AUTHOR]

The article presents the impact of Covid-19 on U.S. veterinary profession. Topics include helping veterinarians for implementing best practices and alleviating client and employee concerns; keeping a ratio of nonveterinarian staff members to veterinarians maximizing labor utilization; and decreasing in several key areas during the survey period including client traffic, operating hours, and revenue.

The article discusses security purchases of small business investments companies in the United States. The article focuses on the concept of a capital banking structure designed to supply equity and loan capital to small businesses. It is suggested that in the United States there is a growing need for some formal, organized financial machinery to supply long-term loan funds and equity to capital to small business. The article asserts that the availability of long-term loan and equity capital is not adequate in the United States.

The article discusses the role of commercial receivable companies in the financing of small and medium-sized businesses. The article provides a description of the commercial finance industry, its history and the underlying causes for its development, and the relationships that commercial lenders established with banks, who were unable to make these loans to small businesses. The article defines the current role of receivable companies, who purchase the receivables of a given company, assume the bad debt, collect and account for receivables, and offer secured lending. Further, the author outlines the methods and procedures of the commercial receivable industry and provides examples of their work with business.

The article discusses information relative to small business indicated by the experience of the Federal Reserve Bank of New York in their dealings with industrial loans for business during the 1930s. The author recounts his own experience with 13b lending, outlining the common mistakes made in small business concerns, and noting that many of the companies referred to in his study had an average life span of twenty years. The article defines the characteristic difficulties of small business, describes the process of credit investigations and the granting of loans, experience with granted loans, and the significance of the findings noted here in meeting the needs of small business.