Publication date

मा, 2021

Details

Prajnan - Journal of Social and Management , January-March 2021 Volume XLIX No. 4 Pp. 353-385.

Authors

Shivani Badola and Sacchidananda Mukherjee

Abstract

Unincorporated enterprises significantly contribute to India's GDP and generate large scale employment. Lack of access to formal credit often constrains these enterprises to scale up. Understanding factors influencing access to formal credit of unincorporated enterprises is important which may help enterprises to improve performance and become credit worthy. For creditors, present analysis may help to broad base the criteria in selection and disbursement of credit. The present paper explores the factors which influence access to formal credit of unincorporated enterprises across states in India. Results show that various operational and economic characteristics influence access to formal credit. The analysis indicates that size of an enterprise (measured in terms of number of workers, total assets, etc.), gross value added, turnover, maintenance of bank account and written statement of accounts, years of operation, adoption of Information and Communications Technology (ICT), female entrepreneur, registration under various statutory acts/ authorities, ownership type, enterprise type, type of activities (manufacturing, services or trading), enterprises facing problems, receiving government assistance, state-specific variables, etc. are statistically significant factors.