Entrepreneur's Intention in Taking Credit Facility from Bank

Setyawan, Surya and Djajadikerta, Hamfri and Setiawan, Amelia (2022) Entrepreneur's Intention in Taking Credit Facility from Bank. International Journal of Business, Economics and Law, 26 (1). pp. 312-321. ISSN 2289-1552

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Abstract

The micro, small, and medium enterprises (MSMEs) in Indonesia are growing rapidly as the national backbone economy. Unfortunately, Indonesian entrepreneurs tend to face the difficulty in taking credit facilities from the bank for advancing their business. This research wants to identify whether financial knowledge, risk profile, and access to finance can drive Indonesian entrepreneurs to have an intention to take credit facilities from the bank as an official financial institution. The theory of planned behaviour is used to underpin this research for it is believed can predict intention based on entrepreneurs’ logical thinking and experience. This research uses Google Forms to get information from 400 MSMEs' entrepreneurs in Great Bandung. This research shows that risk profile and access to finance have a positive significant impact on the intention to take credit facilities from bank. Financial knowledge has no impact directly on the intention to take credit facilities from bank, but it has an impact through risk profile and access to finance. This research also shows that theory of planned behaviour can be used to explain that intention can be explained by entrepreneurs' logical thinking which is represented by risk profile and access to finance.

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