The effect of enterprise risk management on the supply and demand of commercial credit

Document Type : Original Article

Authors

Abdonaser Derakhsan ¹

Farshid Ahmadi Farsani ²

Alireza Abroud ³

¹ Department of Management, Iranshahr Province University, Sistan and Baluchistan, Iran.

² Department of Accounting, Payame Noor University, Tehran, Iran

³ Department of Management, Payam Noor University, Tehran, Iran.

https://doi.org/10.22067/mfe.2024.85428.1355

Abstract

Commercial credit is the most important source of short-term financing for companies and commercial enterprises. Commercial credit is one of the methods by which companies provide financing for short-term periods. The purpose of this study is to investigate the impact of enterprise risk management on the supply and demand of commercial credit. Enterprise risk management has been used by Gourdon's comprehensive method (2009) and business credit by two methods of receiving and paying to measure it. The statistical population of the research is the companies admitted to the Tehran Stock Exchange in the period of 2013 to 2022, and by using the systematic elimination screening method, 136 companies have been considered as the final sample of the research. In the current research, Eviuz 12 software was used to test the research hypotheses. The results of the regression test showed that risk management directly affects the demand for commercial credit. But it does not affect the supply of commercial credit. Therefore, by controlling the risks facing the company, it is possible to obtain higher financing through commercial credit and reduce the need to keep cash in purchases.

Keywords

supply and demand of commercial credit

risk management

credit financing

Tehran Stock Exchange

Subjects

• Startups and its financing

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