ISSN 2413-2322 (Online)

ISSN 2221-1055 (Print)

UDS: 338.242 DOI: https://doi.org/10.32317/2221-1055.202103006
Наукове забезпечення розвитку агропромислового комплексу

The system of credit guarantees as a tool to increase financing for small and medium-sized agricultural enterprises / Lupenko Yu.O., Andros S.V. // Ekonomika APK. - 2021. - № 3 - P. 6

The purpose of the article is, based on the analysis of the best international experience, to formulate theoretical aspects and offer recommendations aimed at developing an effective system of credit guarantees to increase financial support for small and medium-sized agricultural enterprises. Research methods. In the process of research, depending on the goals and objectives, the following methods of cognition and analysis of economic processes were used: theoretical generalization - when substantiating theoretical provisions on the functioning of the system of credit guarantees; statistical comparisons - in identifying and assessing the effectiveness of state regulation of the system of financing small and medium-sized businesses; analysis of hierarchies - when determining promising ways of financial support for small and medium-sized agricultural enterprises; systemic method - in assessing the effectiveness of government regulation of the system of credit guarantees as one of the key tools widely used with the support of enterprises in the agricultural sector of the economy; expert assessments - when systematizing the main guarantee schemes and types of guarantee products and restrictions on their practical application; analysis and synthesis, induction and deduction, comparison - in the study of international experience in the implementation of guaranteed lending programs and consideration of the existing schemes for organizing this activity. Research results. The main provisions of the development of the system of financial support for small and medium-sized agricultural enterprises are formulated and methodological approaches to its improvement in the context of reforming the national economy are developed. The expediency of the development of programs for providing loans was determined, taking into account their role in reducing the restrictions on lending by banks to small and medium-sized agricultural enterprises. Conceptual foundations for the implementation of guarantee programs carried out with state participation have been developed. It has been established that targeted long-term and medium-term loans and guarantees allow covering the risks associated with agricultural activities by providing financial resources for the development of production. The necessity of developing a system of credit guarantees as the most effective instrument of financial support for enterprises in the agricultural sector of the economy has been proved. It was found that a good result can be achieved through the provision of guarantees that provide a partial amount of credit, when the farmer also bears some responsibility for the return of the funds received. Scientific novelty. Conceptual foundations for the development of a loan guarantee system have been developed The introduction of government measures aimed at increasing the volume of lending to small and medium-sized agricultural enterprises is proposed. The system of credit guarantees was further developed as the most effective instrument capable of alleviating difficulties in obtaining a bank loan for small and medium-sized agribusiness. On the basis of the best international experience, the national system of guaranteeing loans was improved with the formation and functioning of specific financial institutions (funds) specializing in ensuring the provision of commercial loans to enterprises of the agro-industrial complex. Practical significance of the article lies in bringing the theoretical and methodological provisions to the level of practical recommendations in the development of national measures for financial support and stimulation of the development of small and medium-sized agricultural enterprises in Ukraine. The formulated provisions, conclusions and recommendations are of interest to managers and employees of enterprises in the agricultural sector of the economy. The research materials can be used in the activities of guarantee organizations, financial and credit institutions, government bodies. Tabl.: 2. Figs.: 2. Refs.: 19.
Key words: guarantee systems; small and medium-sized agricultural enterprises; support; financing

References

  1. Kraemer-Eis, H., Lang, F., Torfs, W. & Gvetadze, S. (2015). European Small Business Finance Outlook. Working Paper 2015/32. EIF Research & Market Analysis. Luxembourg. Retrieved from: https://www.ggb.gr/sites/default/files/basic-page-files/EIF_2015%20European%20Small%20Business%20Finance%20Outlook_2015_32.pdf [In English].
  2. Zander, R., Miller, C. & Mhlanga, N. (2013). Credit Guarantee Systems for Agriculture and Rural Enterprise Development. Rome, Food and Agriculture Organization of the United Nations. Retrieved from: http://www.fao.org/3/i3123e/i3123e00.pdf [In English].
  3. Nitani, M. (Miwako) & Riding, A.L. 2005. Promoting Enterprise Development or Subsidizing Tradition? The Japan Credit Supplementation System. International Small Business Journal, 23(1), pp. 48–71. doi:10.1177/0266242605048870 [In English].
  4. Lien-Wen Lianga, Bor-Yi Huangb, Chih-Feng Liaob, Yu-Ting Gaob. (2017). The Impact of SMEs’ Lending and Credit Guarantee on Bank Efficiency in South Korea. Review of Development Finance, 7(2), pp. 134–141. https://doi.org/10.1016/j.rdf.2017.04.003 [In English].
  5. Riding, A., Madill, J. & Haines, G. (2007). Incrementality of SME Loan Guarantees. Small Business Economics, 29, pp. 47–61. https://doi.org/10.1007/s11187-005-4411-4 [In English].
  6. Leone, P., Panetta, I.C. & Porretta, P. (2013). Credit Guarantee Institutions, Performance and Risk Analysis: An Experimental Scoring. Bank Stability, Sovereign Debt and Derivatives. Palgrave Macmillan Studies in Banking and Financial Institutions. J. Falzon (Ed.). London, Palgrave Macmillan. pp. 115–160. DOI:10.1057/9781137332158_6 [In English].
  7. Nitani, M. & Riding, A. (2005). Promoting Enterprise Development or Subsidizing Tradition? The Japan Credit Supple-Mentation System. International Small Business Journal, 23, pp. 48–71 [In English].
  8. Saito, K. & Tsuruta, D. (2018). Information Asymmetry in Small and Medium Enterprise Credit Guarantee Schemes : Evidence from Japan. Applied Economics, 50(3), pp. 1–17. DOI:10.1080/00036846.2017.1400651 [In English].
  9. Beck, T., Klapper, L.F. & Mendoza, J.C. (2010). The Typology of Partial Credit Guarantee Funds around the World. Journal of Financial Stability, Elsevier, 6(1), pp. 10–25. https://doi.org/10.1016/j.jfs.2008.12.003 [In English].
  10. Gropp, R., Gruendl, C. & Guettler, A. (2013). The Impact of Public Guarantees on Bank Risk-Taking : Evidence from a Natural Experiment. Review of Finance, 18(2), pp. 457–488. https://doi.org/10.1093/rof/rft014 [In English].
  11. Balog, A. (2018). Analysis of SME Segment Lending Processes in Light of Credit Guarantees in the European Union. Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), 17(1), pp. 62–82. DOI:10.25201/FER.17.1.6282 [In English].
  12. Riding, A.L. & Haines, G.Jr. (2001). Loan Guarantees : Costs of Default and Benefits to Small Firms. Journal of Business Venturing, 16(6), pp. 595–612 [In English].
  13. OECD (2006). The SME Financing Gap : Theory and Evidence. Financial Market Trends, 2006(2), pp. 89–97. Retrieved from: https://www.oecd-ilibrary.org/finance-and-investment/the-sme-financing-gap-theory-and-evidence_fmt-v2006-art11-en. https://doi.org/10.1787/fmt-v2006-art11-en [In English].
  14. Zubkova, S.V. & Doroganova, O.G. (2015). Primenenie garantijnogo mehanizma podderzhki malogo i srednego biznesa [Application of a Guarantee Mechanism to Support Small and Medium-Sized Businesses]. Bankovskoe delo, 3, pp. 60–64 [In Russian].
  15. Riding, A.L. & Haines, G.Jr. (2001). Loan Guarantees : Costs of Default and Benefits to Small Firms. Journal of Business Venturing, 16(6), pp. 595–612 [In English].
  16. Kirhner, R. & Korjakin, I. (2016). Kreditno-garantijnaja shema dlja MSB v Belarusi : obzor i rekomendacii [Credit Guarantee Scheme for SMB in Belarus : Overview and Recommendations]. Nemeckaja jekonomicheskaja gruppa Belarus'. Issledovatel'skij centr IPM. Analiticheskaja zapiska [PP/05/2016]. Berlin/Minsk. Retrieved from: https://www.get-belarus.de/wordpress/wp-content/uploads/2016/07/PP_05_2016_ru.pdf [In Russian].
  17. Kiseleva, O.V. & Karcev, S.V. (2016). Ispol'zovanie finansovo-kreditnogo mehanizma dlja aktivizacii malogo biznesa i predprinimatel'stva v Rossii [The Use of a Fnancial and Credit Mechanism for the Activation of Small Business and Entrepreneurship in Russia]. Internet-zhurnal «NAUKOVED», vol. 8 (1). Retrieved from: http://naukovedenie.ru/PDF/70EVN116.pdf [In Russian].
  18. Caselli, S., Corbetta, G., Rossolini, M. & Vecchi, V. (2019). Public Credit Guarantee Schemes and SMEs’ Profitability : Evidence from Italy. Journal of Small Business Management, 57, pp. 555–578. http://dx.doi.org/10.1111/jsbm.12509 [In English].
  19. Lupenko, Yu.O., Shpykuliak, O.H., Malik, M.Yo., et al. (2017). Rozvytok malykh ahrarnykh pidpryiemstv u rynkovomu instytutsiinomu seredovyshchi : indykatory ta efektyvnist : monohrafiia [Development of small agrarian enterprises in the market institutional environment : indicators and efficiency : monograph]. O.H. Shpykuliak (Ed.). Kyiv : NNTs «IAE» [In Ukrainian].
Read article: ekonomikaapk_2021_03_p_6_19.pdf