Kacer, M., Wilson, N. orcid.org/0000-0001-5250-9894 and Zouari, S. (2024) Defaults on government guaranteed loans by potential high growth firms: Evidence from the COVID-19 period. Economics Letters, 243. 111941. ISSN 0165-1765
Abstract
Equity finance is used to fund innovative and growth-oriented businesses because of its resilience during economic downturns and investors' willingness to undertake higher risks compared to other financing. During the pandemic, 6,500 equity-funded firms obtained government-guaranteed loans from traditional banks and new lenders. Our analysis of the determinants of loan default revealed that new lenders experienced a significantly higher default rate than the main banking sector. Additionally, firms funded by equity crowdfunding have a higher loan default rate than those backed by other equity providers. We explore the factors influencing defaults and variations by lender and investor type.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2024 The Author(s). This is an open access article under the terms of the Creative Commons Attribution License (CC-BY 4.0), which permits unrestricted use, distribution and reproduction in any medium, provided the original work is properly cited. |
Keywords: | guaranteed loan, equity-funded companies, loan default, lender type, investor type, COVID-19 crisis |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Accounting & Finance Division (LUBS) (Leeds) |
Funding Information: | Funder Grant number ESRC (Economic and Social Research Council) ES/W010259/1 ESRC (Economic and Social Research Council) Not Known |
Depositing User: | Symplectic Publications |
Date Deposited: | 28 Aug 2024 08:49 |
Last Modified: | 18 Oct 2024 14:36 |
Status: | Published |
Publisher: | Elsevier |
Identification Number: | 10.1016/j.econlet.2024.111941 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:216467 |