An Empirical Study on Determinants of Loan Repayment Behaviour of SMEs Towards Commercial Banks

India, as a developing economy even after five decades of planning, still has a long way to catch up with the advanced economies of the globe. The goal may be distant, but surely, the time needed to reach can be reduced by accelerating the pace of development. One way of doing this is by the development of industrial and business ventures. There exists a positive relationship between the growth of an economy and the growth of small and medium enterprises (SMEs). SMEs play a vibrant role in the development of an economy. Access to the formal source of credit by entrepreneurs is essential in a growing economy. Lending to SMEs is a risky activity for the banks as repayment of these loans are less guaranteed. The research article attempts to analyse the factors influencing the loan repayment behaviour of SMEs towards commercial banks. Data are collected using the convenience method of sampling from 80 registered SMEs belonging to the manufacturing and service sectors in the Bangalore region, and data are analysed using statistical tools such as correlation and logit regression analysis, conclusions are drawn based on these findings. The study reveals that characteristics of loan and lender influence the repayment to the maximum extent. The findings are helpful for commercial banks in redesigning suitable policies and schemes to reduce loan defaults.

Perception of Small-Scale Entrepreneurs Towards Government Support in Uttarakhand

Entrepreneurship is seen as a driving force for economic development and job creation. Hence, the government offers different forms of support to entrepreneurs. Many researchers have examined the effectiveness of government support. However, the question of how small-scale entrepreneurs perceive government assistance remains unanswered. The study seeks to assess the perception of small-scale entrepreneurs towards government support and also tries to explore some underlying factors pertaining to government support towards entrepreneurship development in Uttarakhand. The study is based on primary data collected from 240 small-scale entrepreneurs, using a self-structured questionnaire. Descriptive statistics and principal component analysis (PCA) were used to interpret the results. It has been found that small-scale entrepreneurs have a positive perception towards single window clearance system, investment promotion facility centre and timelines for business approvals. The study further found that small-scale entrepreneurs have a negative perception towards the interest rate, transparency in loan sanctioning and the behaviour of the employees of financial institutions. The study also extracted three important factors from PCA and named them as an online support system, transparency and financial support.

Innovation for Economic Resilience and Sustainability: A case study of Sambalpuri Ikat Handloom Cluster of Bargarh in India

Employing more than three million people, handloom weaving is one of the largest economic activities after agriculture. It constitutes 15% of the cloth production in India and 95% of the global handmade fabric. However, the return on investment in the sector remains low and the industry is under constant threats from power-loom and other substitutes. Nonetheless, the Sambalpuri Ikat is an unrivalled example, which has flourished over the years because of a series of innovations diffused by the weavers without compromising on the traditional Ikat artistry. Predominantly consisting of micro-enterprises, this cluster demonstrates that technological innovations have enhanced the income of the weavers by more than 300%, and ensured better occupational health and gender equity. The cluster ecosystem has enabled the adoption of innovations in more than 8,000 units, over 13 years. This article highlights learning from the Bargarh Sambalpuri Ikat Handloom cluster on how a traditional cluster could maintain its growth trajectory despite being threatened by several shocks and challenges.

Efficiency Analysis of Food Processing Industry

Food processing industry (FPI) is at a nascent stage and is tagged as a sunshine industry. The efficiency and productivity of the inputs for the aforesaid industries have to be measured to not only find out if the potential is achieved or not, but also to identify the grey areas. Against such a backdrop, it is obvious that industries like FPI would grow and become the subject matter for further investigation. The research revealed that the majority of cases have been consistent with the real facts and the underlying principles, and the structure of the economy provide valid reasons for it. However, in some cases, the results have not been consistent with the movement of the economy and there are no valid economic reasons for the performance of the state.

COVID-19 Pandemic and Problems of Micro-enterprises in Dibrugarh District of Assam: An Empirical Study

Small-scale industries play a crucial role in industrialisation of India. These industries face numerous problems, some of which are peculiar to them, while others are common to both small-scale and large-scale industries. The COVID-19 pandemic has unleashed unprecedented threats as well as opportunities on this sector. This article tries to analyse the problems affecting the entrepreneurs associated with 141 micro-manufacturing enterprises in the Dibrugarh district of Assam and puts forward some policy suggestions. In order to identify the most pressing problem faced by the entrepreneurs, the Garrett ranking method is employed in the study. It is found that dearth of skilled labour is the most acute problem encountered by the sector. Lack of proper marketing arrangements, shortage of quality and cheap raw materials, obsolete technology and lack of timely finance are other important hindrances. The significance of skilled labour points to the intense need for continuous skill development of the local workforce by establishing more technical institutes, training programmes, etc. Furthermore, the government should provide special assistance for technological upgradation, develop institutional marketing facilities, and supply cheap and quality raw materials. Further, simplification of procedures in banks’ lending policies, relaxation of requirements like collateral security and margin money may go a long way in enhancing both confidence and performance of small entrepreneurs.

Assessing the Impact of Financial Literacy on Firm Sustainability: Mediating Role of Financial Access and Firm Growth

Even though firm sustainability is a long-standing concern, just a few studies on micro, small and medium enterprises (MSMEs) sustainability have been conducted. Many studies have concentrated on a few particular sustainability criteria, but there is no comprehensive study on the subject from which to make concrete conclusions. The present research was inspired by the idea to examine how resources such as financial literacy, financial access and company development influence the sustainability of MSMEs. Data was gathered from 438 owner-managers of micro, small and medium enterprises through a questionnaire. The research discovered that financial literacy, financial availability and company growth are positively correlated with firm sustainability when using partial least squares. Surprisingly, the research found that financial access and firm growth moderate the anticipated connection between financial literacy and sustainability. As a result, policymakers and practitioners should ensure that firms have better access to financial resources, that owner-managers have the necessary financial literacy and that micro, small and medium-sized businesses grow effectively better firm sustainability.

A Comparative Analysis of Women and Men-Owned MSMEs with Special Emphasis on Women Entrepreneurship: A Case Study of Cachar District, Assam

The purpose of this research is to investigate the effect of micro, small and medium enterprises on women entrepreneurship development with particular reference to Cachar district of Assam. The study also aims to compare the characteristics and performance of women-owned MSMEs with those owned by men. A survey method is used to gather information from 200 MSME owner-managers located in various revenue circles/ tehsils of Cachar district. The results of the study indicate that, though very slowly, MSMEs are significantly promoting women entrepreneurship. The most important reasons for women entrepreneurs to join MSMEs appear to be (a) ‘profit motive’ or ‘to earn better income’, (b) ‘desire for independence’ and (c) ‘to support family’ or ‘the desire to provide financial security to the family’. The results of the Kruskal Wallis test demonstrate that women entrepreneurs’ background characteristics such as their marital status, age, levels of educational attainment, previous business experience and place of residence significantly affect their motivations to join MSMEs. While the employment growth in female-owned MSMEs is much higher than their male counterparts, net-return per owner-manager is found to be significantly higher in men-owned MSMEs than in women-owned MSMEs.

The Industrial Research and Development Profile of the MSME s Sector in India

The process of research and development (R&D) is characterised by improvisation, improvement and innovation based on information, knowledge and experimentation. It is the key to modern industrial development. Theoretically, firms are supposed to invest in R&D in order to enhance their existing offering and stay in business, given the competitive globalised market. The Indian economy is characterised as one of the growing global economies. Industrialisation process in India is dominated by the micro, small and medium enterprises (MSMEs). A low level of operation keeps these firms on a small budget, thus making the sector non-conducive in conducting firm-specific R&D. The current article is an empirical elucidation of the MSMEs’ industrialisation process in light of industry-specific R&D. The study is based on the Annual Survey of Industries data, analysing the national-level industrialisation process for 3 years from 2016 through 2018. The article finds that the overall MSME sector-specific R&D atmosphere in the country is not satisfactory. There is no correlation and symmetry between the level of industrialisation across states, average output and the R&D process. The findings of the article recommend a change in the industrial policy with a focus on the growth and development of industry-specific R&D.

Accounts Receivable: Payable Impact on Each Other with Special Reference to Financial Performance—A Study of Small Cap Companies

Trade credit is important as a funding source for companies having a liquidity shortage. Trade credit comprises of both accounts receivable and payable. The financial literature has discussed the impact of accounts receivable or payable on a company’s financial performance. However, there is a lack of studies on the effects of accounts receivable and payable on each other and further its effect on the financial performance of small-cap companies. Financial performance is determined using the profitability and value of the company. The researchers examined the financial performance implications of offering and receiving trade credit for a sample of 193 BSE small-cap manufacturing companies in India during the period 2011–2019. Granger causality test, Levin, Lin and Chu Unit root test, correlation and regression have been used for data analysis. The finding suggested that accounts receivable influenced the use of accounts payable. The aftermath of accounts payables is that it negatively and significantly affected the profitability and had an insignificant relationship with the value of the company. The result implies that effective management of accounts receivable can influence the application of accounts payable that improves a company’s profits and value. The current study is useful for SMEs’ managers in determining the financial performance and capital structure.

Occupational Health and Safety Maintenance in Micro and Small Enterprises: A Study on Select Sectors of West Burdwan, West Bengal

In any developing country like India, Micro and Small Enterprises (MSEs) showed its best effort in improving the mass standard of living by ensuring employment generation. Thus the grass root people who otherwise might not get entered into the formal sector due to lack of technical skill and education could get their employment there easily. But the lack of technical know-how of the participants of MSEs may not allow them to have awareness of occupational hazards. This calls for a severe problem in Health and Safety related issues in MSEs for those individuals. The present study, therefore, takes its objectives to highlight on the maintenance of Occupational Health and Safety (OH&S) related issues in MSEs where the perceptions of the participants play an important role. To fulfil these objectives, the study takes its attempt to pursue a primary survey on 95 randomly selected participants out of 24 registered MSEs of select sectors of West Burdwan, an industrially developed district of West Bengal. The sectors are selected purposively based on their significant presence in West Burdwan. The data have been collected through questionnaire and non-parametric tests has been used for further assessment. It is found that creating cozy atmosphere, privacy, artificial lighting conditions, ventilation, facilities for rest and meals, and so on are the factors to be maintained under OH&S in MSEs. The responses of the participants are found as sector specific and socio-demographic characteristics specific. In this issue, while the young male members like ‘facilities for rest and meals’, the female members prefer ‘privacy’ as the factor to be maintained for OH&S in MSEs. Thus the paper in its policy implication exhibited the sector-wise and socio-demography wise preferences of the participants on OH&S related issues.