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- Title
determinantS of trade credit SuPPLY for tHe LiSted non-financiaL firmS of PakiStan.
- Authors
khan, mubashir ali; Wajidi, faraz ahmed; batool, fouzia
- Abstract
Firms generally prefer to sell goods on cash than on credit, but the competitive environment compels them to offer credit to most of their customers. Although nonfinancial firms have better access to the financial channel, they still rely on trade credit to increase the market share. This research aims to find out the determinants of Pakistani listed non-financial companies' Trade Credit Supply. The data was collected from 2014 to 2019 for 162 non-financial firms. By using fixed-effect panel estimation the study found that the variables such as firm size, credit rating, and, short term bank financing are significant determinants of trade credit supply. Whereas, profitability is found to be an insignificant determinant of trade credit supply. The study recommends policymakers to develop and encourage the trade credit channels to enhance and promote the trade credit in the economy and build trust and better customer relationships by discouraging the conventional mechanism.
- Subjects
PAKISTAN; CREDIT; CREDIT ratings; BOND market; BUSINESS enterprises; PANEL analysis
- Publication
New Horizons (1992-4399), 2020, Vol 14, Issue 2, p141
- ISSN
1992-4399
- Publication type
Article