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This study aims to analyze the level of accuracy of financial distress prediction models and to test the ability of liquidity risk ratio, credit risk and capital ratio in predicting the possibility of financial distress in rural banks (BPR) in Indonesia. The data used is sourced from secondary data and collected from BPR's financial statements published on the Financial Services Authority (OJK) website during the 2014-2023 period. The population in this study is all rural banks as many as 1,402 rural banks and the number of samples is 312 rural banks spread throughout Indonesia. Determination of samples by the Slovin method by proportionate stratified random sampling technique. The results of the study that the liquidity risk ratio, credit risk and capital ratio in predicting financial distress can be used with an accuracy rate of 95.90%. Liquidity risk ratio and credit risk ratio have a positive and significant effect, capital ratio and primary ratio have a negative and significant effect, while capital adequacy ratio has a positive and significant effect on the possibility of financial distress in rural banks in Indonesia. [ABSTRACT FROM AUTHOR]

The Rural Bank (BPR) plays a crucial role in the Indonesian banking industry, particularly at the regional level, serving as an alternative financing source for the unbankable population. This research aims to analyse the productivity levels of BPRs in East Java using the Malmquist Productivity Index (MPI) during the period from 2016 to 2022. The study sample comprises 30 BPRs in East Java. The analysis results indicate that the productivity of BPRs in East Java fluctuates from year to year. Moreover, during the COVID-19 pandemic, BPR productivity experienced a significant decline. The study provides recommendations for BPR management and regulators to pay more attention to BPR productivity and decision-making foundations. [ABSTRACT FROM AUTHOR]

Improvement of every financial institution is based on the quality of service they provide. In the Philippines, most bank’s clients prefer financial institutions that render quality service. With resurgence of interest and need for effective delivery of service, this study aimed to determine the effectiveness of service provided by selected rural banks in terms of tangibility, responsiveness, reliability, empathy and assurance. It utilized descriptive method and selected two hundred client-respondents through quota sampling. The results showed significant differences in empathy, reliability, responsiveness and assurance when grouped according to sex, kind of service availed and monthly income. However, no significant difference was found when the five dimensions are grouped according to age and civil status. The results further revealed that the company is highly effective in providing quality service in terms of assurance and reliability, and effective in terms of tangibility, responsiveness, and empathy. From the assessments of customer experience, the banks need to provide more modernized facilities for better services, furnish more pamphlets and promotional tools to educate clients on the bank regulations, new products or services catered, and improve facilities by providing additional seats and reading materials while clients are waiting for their transactions.

This study aims to review effect of switching costs on rural bank market power. This study is using dynamic panel regression of the Generalize Method of Momments (GMM). This paper used panels of 1266 Rural bank and 113 Sharia Rural bank during 2013-2019. To further analyze this study using Lerner Index as proxies of market power, Bertrand Competitions models as proxies of switching costs and banking indicators covering bank size, equity, non-interest income, and the burden of allowance for productive assets (Lost Loans Provision). The results show that switching costs have a significant positive effect on conventional rural bank and negatively affect sharia rural banks market power. This condition is caused by various reasons, namely the limited choice of rural banks so that consumers survive the switching costs charged. Meanwhile, in sharia rural bank transparency is clearly seen on the side of mudharobah and musyarakah which makes it unable to increase financing margins freely. [ABSTRACT FROM AUTHOR]

The urgency of the internal model of default credit for the rural bank in Indonesia is increasing due to the recent acceleration of the increase in Non-Performing Loans at rural banks. This research will formulate an internal model of default credit that can reduce the level of default risk in rural banks based on the explanatory sequential design of mixed research method. The findings of quantitative analysis integration by Chi-Square Analysis, Discriminant Analysis, and Logistics Regression analysis at BPR BKK Pekalongan Regency in 2021 will be explored further by qualitative research. Using nine variables that affect debtors' failure, this study finds that the interest rate is a variable that consistently affects the status of default loans using the integration of 3 analyses and qualitative analysis. The study results indicate that rural banks need to pay more attention to determining credit interest rates when prospective debtors apply for credit. The determination of interest rates is related to compensation for risks faced by rural banks in connection with asymmetric information about the debtor's ability to pay while considering the interest rate determined by the IDIC. [ABSTRACT FROM AUTHOR]

Previous studies analyzing the relationship between the performance of rural banks and the COVID-19 pandemic are very limited in number. This study aims to find out how the impact of the COVID-19 pandemic on the performance of rural banks in Indonesia. This study uses panel regression data to examine the effect of the COVID-19 pandemic on the capital adequacy ratio (CAR) from the capital aspect, non-performing loan (NPL) from the asset quality aspect, return on assets (ROA) from the earning aspect, and cash ratio (CR) from the aspect of liquidity. Our findings explain that the COVID-19 pandemic has a positive effect on CAR and NPL, a negative effect on ROA, and no effect on CR. [ABSTRACT FROM AUTHOR]

Two-thirds of the world’s poorest and vulnerable, mostly women, live in rural areas, engaging in subsistence agriculture. Hence, in Ghana, rural banking was introduced to provide microcredit services to the marginalised neglected by commercial banks. One of such banks is the Sonzele Rural Bank in Jirapa was set up to offer credit services to improve the living condition, yet poverty in Jirapa is still high. This study, therefore, sought to investigate the role of rural banks in poverty reduction drawing evidence from the Sonzele Rural Bank in Jirapa. Using a cross-sectional design, the study employed structured interviews to collect data. The cluster sampling technique was used to select thirteen women’s groups in Jirapa, and purposive sampling enabled the selection of four project staff. Paired-samples t-test and Kendall’s coefficient of concordance were employed in the analysis. The study revealed that credit with education was given to women in groups which enabled them to set up various enterprises and experienced an increase in income and expenditure on education and health thus, reducing poverty in the area. Beneficiaries noted that the issues of high-interest charges, short repayment schedules and absence of insurance policy need attention to make credit a poverty reduction tool. [ABSTRACT FROM AUTHOR]

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This study investigates the existence of monetary policy transmission via bank lending channel on Indonesian rural banks that located across provinces. The datasets consist of 1860 rural banks that located in 34 provinces in Indonesia. Using the dynamic system generalized method of moments (GMM) estimations, the empirical results indicate that monetary transmission via bank lending channel works on rural bank in Indonesia. When the central bank of Indonesia tightening the monetary policy, the lending channeled by rural banks reduce, and vice-versa. Our findings implies that the transmission of monetary policy via bank lending channel is remain strong policy provided by central bank. [ABSTRACT FROM AUTHOR]

Abstract: The research on the Structure-Conduct-Performance (SCP) hypothesis in the banking industry has been done many times, including in Indonesia. However, it still focuses on commercial banks. This research aims to examine the relationship between market structure and bank performance by involving commercial banks and rural banks (Bank Perkreditan Rakyat/BPR) when they are in the same market in the regency/city level. It uses panel data from 565 banks in Central Java: 261 BPR and 304 Commercial Banks, divided into 34 regencies/cities during 2012-2016. Independent variables involve market concentration and market share which is also as moderating variable, and the dependent variable is bank performance. The hypotheses are examined by multiple linear regression with a random effect model. In general, the results support that the market structure has a significant positive effect on bank performance. Another result has found no collusive behavior among dominant banks. Keywords: Structure-Conduct-Performance, Commercial Bank, Rural Bank, Market Structure, Bank Performance Pengaruh Struktur Pasar terhadap Kinerja Bank di Jawa Tengah Abstrak: Penelitian mengenai hipotesis Structure-Conduct-Performance (SCP) pada industri perbankan telah banyak dilakukan, termasuk di Indonesia. Namun, penelitian tersebut hanya berfokus pada bank umum saja. Penelitian ini bertujuan untuk menguji hubungan antara struktur pasar dan kinerja bank dengan melibatkan bank umum dan Bank Perkreditan Rakyat (BPR) ketika berada di pasar yang sama di tingkat kabupaten/kota. Penelitian ini menggunakan data panel terdiri dari 565 bank di Jawa Tengah: 261 BPR dan 304 Bank umum, yang terbagi ke dalam 34 kabupaten/kota selama tahun 2012-2016. Variabel independen yaitu konsentrasi pasar dan pangsa pasar yang sekaligus sebagai variabel moderasi, dan variabel dependen adalah kinerja bank. Hipotesis diuji menggunakan regresi linier berganda dengan random effect model. Secara umum, hasil mendukung bahwa struktur pasar berpengaruh positif signifikan terhadap kinerja bank. Hasil lainnya menunjukkan tidak terdapat perilaku kolusif di antara bank-bank besar. Kata kunci: . Structure-Conduct-Performance, Bank Umum, BPR, Struktur Pasar, Kinerja Bank.

In The Present-Day World, Numerous Organizations, In Various Industries Like Retailing, Insurance, Banking And Other Service Providers, Understand The Significance Of Customer Relationship Management (Crm) And Its Importance In Acquiring New Customers And At The Same Time They Focus On Holding The Existing Ones So As To Increase Their Competitive Advantage In The Industry. This Study Attempts To Analyze The Effect Of Crm Practices On Customer's Satisfaction, In The Rural Banks Of Kerala. Significant Data Was Collected From Both Primary And Secondary Sources For The Study. This Study Will Help The Selected Banks To Effectively Implement Crm Practices. [ABSTRACT FROM AUTHOR]

We investigate the extent of credit risk management in the leading Indonesian Microfinance Institution (MFI's): rural bank. Specifically, we focus on the role of diversification, capital buffer, and ownership on the probability of incidence and trajectory of two credit risk proxies—loan loss reserve to non-performing loan ratio (LLR_NPL) and net non-performing loan to total loan ratio (NPL_Net). Proportional hazard parametric exponential regression and Kaplan Meier survival function are applied to a balanced panel dataset of 852 rural banks from June 2010 to March 2019 (30672 bank quarter observations). We find that credit risk began to surface between 16–23 quarters. Government ownership and funding diversification positively impact credit risk management. A different nature of credit risk proxy (LLR_NPL versus NPL_Net) significantly affects the role of capital buffer, type of ownership, and credit risk trajectory. Our study has highlighted the importance of coordinated regulatory-supervisory practices especially for rural banks owned by cooperatives. [Display omitted] • Credit risk began to surface between 16–23 quarters. • Government ownership and funding diversification positively impact credit risk management. • A different nature of credit risk proxy (LLR_NPL versus NPL_Net) significantly affects the role of capital buffer, type of ownership, and credit risk trajectory. • Improved coordination is required since businesses are all the same, that is, rural banks. They should submit to the same regulatory and supervisory regime. [ABSTRACT FROM AUTHOR]

This study investigates the implementation of culture and religiosity in credit management and then attempts to analyze the effect of culture and religiosity to the breadth of outreach in Rural Banks. This research is a quantitative study based on a survey at Rural Banks in West Sumatera Indonesia in 2018, with a sample of 52 Rural Bank. Data were collected by using questionaire and analyzed by PLS-regression.. The independent sample t-test also applied to compare the breadth of outreach or social performance in Conventional Rural Banks and Islamic rural banks. This study proves that the breadth of outreach is influenced by culture and religiosity and there is no difference of the breadth of outreach between Conventional Rural Bank and Islamic Rural Bank. These finding extends the predictor of the breadth of outreach in Rural Banks and offer a more established model of causal relationships between culture and religiosity to the breadth of outreach. This study also proves that there is no difference in the breadth of outreach between Conventional Rural Banks and Islamic Rural Banks, which means that there are no differences in the achievement of the social performance of these two types of micro financial institutions. Penelitian ini menganalis implementasi aspek budaya dan religiusitas dalam manajemen kredit untuk kemudian mengelaborasi lebih lanjut pengaruh faktor budaya dan religiusitas terhadap keluasan jangkauan Bank Perkreditan Rakyat (BPR). Penelitian ini merupakan penelitian kuantitatif berdasarkan survey pada BPR-BPR di Provinsi Sumatera Barat Indonesia pada tahun 2018, dengan sampel sebanyak 52 BPR. Data dikumpulkan dengan menggunakan kuesioner dan dianalisis dengan Regresi PLS untuk memprediksi dampak budaya dan religiusitas terhadap keluasan jangkauan. Uji-independent sample t -test juga diterapkan untuk membandingkan keluasan jangkauan BPR Konvensional dan BPR Syariah. Penelitian ini membuktikan bahwa keluasan jangkauan dipengaruhi oleh budaya dan religiusitas dan tidak ada perbedaan keluasan jangkauan antara BPR Konvensional dan BPR Syariah. Temuan ini memperluas prediktor keluasan jangkauan di Bank Perkreditan Rakyat dan menawarkan model hubungan sebab akibat yang lebih mapan antara budaya dan religiusitas terhadap keluasan jangkauan. Penelitian ini juga membuktikan bahwa tidak ada perbedaan keluasan jangkauan antara BPR Konvensional dan BPR Syariah, yang berarti tidak ada perbedaan dalam pencapaian kinerja sosial kedua jenis lembaga keuangan ini.

This study aims to examine the impact of the growth of peer-to-peer (P2P) lending on the growth of rural bank lending. Further, this study investigates the outcome of the partnership agreement between the Rural Bank Association and Financial Technology (FinTech) Association in the last quarter of 2017 on the effect of P2P lending on rural bank lending by analyzing the impact separately in 2018 and 2019. The publicly available data from the Financial Services Authority and Bank of Indonesia were examined using panel data regression. The results show that P2P lending’s growth is a substitute for the growth of the rural bank loan in 2018. However, the partnership between the Rural Bank Association and FinTech Association changed the effect of substitution into complementary in 2019. Moreover, the impact of P2P lending was more prominent in provinces with a higher number of rural banks and regions with lower economic growth. The restricted number of publicly available data becomes the limitation of this study to obtain the best results.

This study aims to examine the impact of the growth of peer-to-peer (P2P) lending on the growth of rural bank lending. Further, this study investigates the outcome of the partnership agreement between the Rural Bank Association and Financial Technology (FinTech) Association in the last quarter of 2017 on the effect of P2P lending on rural bank lending by analyzing the impact separately in 2018 and 2019. The publicly available data from the Financial Services Authority and Bank of Indonesia were examined using panel data regression. The results show that P2P lending’s growth is a substitute for the growth of the rural bank loan in 2018. However, the partnership between the Rural Bank Association and FinTech Association changed the effect of substitution into complementary in 2019. Moreover, the impact of P2P lending was more prominent in provinces with a higher number of rural banks and regions with lower economic growth. The restricted number of publicly available data becomes the limitation of this study to obtain the best results. [ABSTRACT FROM AUTHOR]

BACKGROUND: In the last few decades, the rural bank has a focus of both researchers and policy-makers as it plays a crucial role in promoting the welfare of lower-income groups in most of the underdeveloped and developing countries, including Indonesia. However, as the newly established micro-financing institutions, as compared to the well-established large-scale commercial banks in the country, these micro-financing institutions have been perceived to have a lower level of competitiveness and performance. OBJECTIVE: Thus, this study explores and analyzes factors of core competency, innovation, and reputation in determining the competitiveness and performance of the rural banks (Bank Perkreditan Rakyat - BPRs) in Aceh, Indonesia. It also attempts to empirically investigate and analyze the mediated effect of competitive advantage on the influences of core competency, innovation, and reputation on performance of the BPRs in the country. METHODS: 350 employees at the 16 BPRs in 7 districts in Aceh province, Indonesia were selected as respondents of the study using the stratified random sampling technique. The study used the structural equation modeling analysis to examine the interrelationships among the variables, to answer the objectives of the study. RESULTS: The study found a positive influence of the core competency, innovation, and reputation on the BPRs' competitive advantage. Except for the BPRs' reputation, all variables positively affected the BPRs' performance. Finally, the study found a significant partial mediated effect of competitive advantage on the relationship between core competency and innovation to the BPRs' performance and a significant full mediated effect of competitive advantage on the relationship between reputation and the BPRs' performance. CONCLUSIONS: These findings imply that all efforts to enhance the BPRs' performance should be focused on the improvement of competitive advantage based on enhancing the competency, innovation, and reputation of the BPRs. [ABSTRACT FROM AUTHOR]

The purpose of this study is to analyze the benefits of the accounting information system for financial performance, performance management and organizational performance at Rural Banks in Batam. The dependent variables of this research are financial performance, management performance, and organizational performance. Independent variable of this research is accounting information system. The object of this research use purposive sampling method to BPR registered in Bank Indonesia which is position of Finance and Accounting Manager, Operational Manager and Branch Manager. This study uses multiple linear regression to analyze the effect of the independent variable to the dependent variable. The results obtained that the accounting information system has a significant influence on financial performance, performance management and organizational performance.

Enhancement of financial inclusivity of rural communities is often recognised as a key strategy for achieving economic development in third world countries. The main objective of this study was to examine the factors that influence consumers’ choice of a rural bank in Gicumbi district of Rwanda. Data was collected using structured questionnaires and analysed using a binary probit regression model and non-parametric procedures. Most consumers were aware of Popular Bank of Rwanda (BPR) and Umurenge SACCO through radio advertisements, social networks and community meetings. Accessibility, interest rates and quality of services influenced choice of a given financial intermediary. Moreover, the decision to open a rural bank account was significantly influenced by education and farm size (p

We examine the role of a typical set of determinants of loan repayment performance of SMEs in the context of a rural bank’s setting in Ghana. Our analysis using survey data suggests that, while higher application cost, loan size and interest rate exert significantly negative influence on loan repayment, higher educational background of the SME operators is associated with significantly better repayment performance. Interestingly, in comparison with those with only primary-level education, SME operators with tertiary education register the best repayment performance followed by those with secondary education. We provide detailed discussion and managerial implications of these findings. [ABSTRACT FROM AUTHOR]

Does bank size significantly explain the variations in bank stability? Does bank funding risk significantly impact bank stability? This paper addresses these two questions with data from the rural banking industry in Ghana. Controlling for credit risk, liquidity risk, diversification in the business model, profitability, inflation, financial structure and gross domestic product, the results suggest that an increase in the size of a rural bank results in an increase in its stability. The results also show that funding risk positively impacts bank stability. The positive relationship between size and bank stability has important repercussions for the current debate on whether or not to constrain bank size to insulate the financial system from future crisis. The positive relationship between funding risk and bank stability also has important implications for the current debate on funding of retail banks.

This paper analyzes the profitability of 112 rural banks (special unit banks created to promote rural financial intermediation in Ghana). The results generally show that bank size, funding risk, diversification, liquidity risk, and bank stability are significant predictors of rural bank profitability. Whereas an improvement in the funding risk of a rural bank in a particular period portends a drop in its profitability in the future, an improvement in the size, diversification, liquidity risk, and stability of a rural bank signifies an improvement in the future profitability of the bank.

This paper analyzes the profitability of 112 rural banks (special unit banks created to promote rural financial intermediation in Ghana). The results generally show that bank size, funding risk, diversification, liquidity risk, and bank stability are significant predictors of rural bank profitability. Whereas an improvement in the funding risk of a rural bank in a particular period portends a drop in its profitability in the future, an improvement in the size, diversification, liquidity risk, and stability of a rural bank signifies an improvement in the future profitability of the bank. [ABSTRACT FROM AUTHOR]

Does bank size significantly explain the variations in bank stability? Does bank funding risk significantly impact bank stability? This paper addresses these two questions with data from the rural banking industry in Ghana. Controlling for credit risk, liquidity risk, diversification in the business model, profitability, inflation, financial structure and gross domestic product, the results suggest that an increase in the size of a rural bank results in an increase in its stability. The results also show that funding risk positively impacts bank stability. The positive relationship between size and bank stability has important repercussions for the current debate on whether or not to constrain bank size to insulate the financial system from future crisis. The positive relationship between funding risk and bank stability also has important implications for the current debate on funding of retail banks. [ABSTRACT FROM AUTHOR]

Abstract: Credit risk assessment for secured loans is an important operation in banking systems to ensure the lenders pay the loans on schedule and to classify the bank as a well performing bank due to regulation. This paper aims to identify factors which are necessary for a rural bank (Bank Perkreditan Rakyat) to assess credit application. By aiming on the reduction of number of non-performing loans, current decision criteria on credit risk assessment are evaluated. Subsequently, a decision tree model is proposed by applying data mining methodology. The credit risk assessment model is applied to PT BPR X in Bali that had 1082 lenders (11.99%) who had non-performing loans and were identified as bad loan cases. This made PT BPR X was categorized as a poorly performing bank. Data mining is used to suggest a decision tree model for credit assessment as it can indicate whether the request of lenders can be classified as performing or non-performing loans risk. Using C 5.0 methodology, a new decision tree model is generated. This model suggests that new criteria in analyzing the loan application. The evaluation results show that if this model is applied, PT BPR X can reduce non-performing loans to less than 5% and the bank can be classified as a well performing bank. [Copyright &y& Elsevier]

Agriculture and rural development banks are one of the oldest institution for rural credit .RDBMS had their beginning in early 1920's as land mortgage banks" The objectives of land mortgage banks was to give long term loans farmers to redeem prior debts . In eighties, the Lbs further diversified their activities to cover non-farm sector financing and then came to known as primary co-operative agricultural rural development bank (CARD) in most of the states. Thailand state is the pioneer in establishing of central land mortgage bank. The state occupies the forth place in the country, which continues to maintain in the same rank. In this study, an attempt is made to study the sources of fund of primary co-operative agriculture rural development Banks. It can be classified into two viz. Owned and borrowed funds. Borrowed funds consist of deposits and amount borrowed from SCAR DB, ABOARD and other financing agencies. In short, the capital structure of Cards consists of share capital, reserves, deposits and borrowings. The composite Than District is chosen as the area of study which covers 3 Revenue districts viz, Adaptation, Than and Thoreau. The study covers the period of eleven years from 2001-2002 to 2011-2012. The Cards in composite Than district has generated more funds from reserve rather than share capital and sample Cards have largely depending on external borrowings. Therefore it is highly imperative to augment their resources through deposits, share capital and reserve and thereby the cost of capital can be minimized to a considerable extent. [ABSTRACT FROM AUTHOR]