Trade Credit and Bank Finance – Evidence from the Visegrad Group

• DOI: 10.7441/joc.2018.03.09
• Publication Date: 2018-10-13T08:23:32Z
• Authors: Ashiqur Rahman; Zoltan Rozsa; ; Martin Cepel
• Keywords: Trade Credit; Slovak; Overdraft; Bank credit; Trade finance; Sample (material)

This paper examines whether bank finance is a substitute or complementary to trade credit for small and medium-sized enterprises (SMEs) in the region of Visegrad Group -the Czech Republic, Poland, Hungary, Slovak Republic.This uses data set provided by Business Environment Enterprise Performance Survey that was conducted European Bank Reconstruction Development World during period from 2012 2014.Using sample 1,140 firms, it discovered firms having an overdraft facility banks use more credit, this supports theory credit.Moreover, results suggest companies are younger, innovative, risky, with concentrated ownership structure operated experienced manager purchase their material inputs services.However, also show service-oriented less than manufacturing firms.