Informal Financing: Is It Attractive to The Companies?
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Abstract
Informal financing is essential as a source of company financing because, apart from being low risk, not all companies have adequate access to formal financing. However, until the latest study, no substantial evidence has been found for the role of informal financing sources on public perception. By taking samples from all companies in Indonesia for the period 2003 to 2022, this study aims to investigate this issue. A series of robust tests, including financial conditions, industry effects, and crises, show that informal financing plays a role in companies. Companies with higher managerial talent in trade credit management will be increasingly attractive to the public and become acquisition targets. The results of this study are useful, at least for academics, companies, and regulators in policy making.
Keywords: Informal Financing; Trade Credit; Acquisition; Crisis; Emerging Market
Australian Academy of Accounting and , volume 6, issue 1, January 2024, pp 98-104
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