Does Trade Credit Facilitate Access to Bank Finance? An Empirical Evidence from Portuguese and Spanish Small Medium Size Enterprises

Abstract

Resumo:O objectivo deste trabalho de investigação consiste em analisar se o crédito comercial obtido junto dos fornecedores e o endividamento bancário são considerados duas fontes de financiamento substitutas e/ou complementares. Usando uma amostra em dados painel de 468 e 7019 pequenas e médias empresas (PME) Portuguesas e Espanholas respectivamente, e recorrendo ao método de estimação GMM, para controlar potenciais problemas de endogeneidade, os resultados confirmam a hipótese de substituição, isto é, as empresas recorrem ao crédito junto dos fornecedores quando vêm restringido o seu acesso ao financiamento junto dos bancos. Este racionamento no acesso ao crédito bancário é particularmente relevante para as empresas que mantêm uma relação de monopólio (negoceiam com apenas um banco), o que indicia maiores problemas de selecção adversa e risco moral para estas empresas. Todavia, apesar de a hipótese de substituição ser confirmada, a evidência empírica aponta para o facto de que as hipóteses de substituição e complementaridade não serem mutuamente exclusivas, em particular para um grupo específico de empresas: as empresas mais jovens e mais pequenas. Em consonância com as teorias que enfatizam o conteúdo informativo veiculado pelo crédito comercial (qualidade da gestão, nível de risco do cliente), os resultados obtidos confirmam que o recurso ao crédito concedido pelos fornecedores ajuda as empresas mais jovens e mais pequenas a consolidarem a sua reputação no mercado de crédito. O montante de crédito comercial obtido pode ser visto como um sinal que veicula a informação privada detida pelo fornecedor aos bancos a baixo custo. Neste contexto, os bancos mostram-se mais predispostos a conceder crédito. Abstract:This paper examines if trade credit could be considered as a substitute and/or a complement to bank credit in order to assess the existence of credit rationing. Using a panel dataset of 468 and 7019 Portuguese and Spanish small medium size enterprises, in the period 1998-2006, and controlling for endogeneity problems by using GMM estimators, the results confirm the existence of credit rationing, since the substitution hypothesis is confirmed. This effect is particularly strong for firms that maintaining an exclusive relationship with one bank, which indicate a greater severity of adverse selection problems for those firms. Although the substitution hypothesis is confirmed, the results seem indicate that the substitution and complementary hypothesis are not mutually exclusive, especially for a specific group of firms: the younger and smaller firms. In line with the theories that emphasize the informational role of trade credit, due the informative advantage of suppliers, our empirical results confirm that trade credit allow the younger and smaller firms to improve their reputation, as trade credit reveals the private information of the supplier to the bank, in turn, banks can update their beliefs about customer default risk and agree to increase bank credit. JEL Classifications: G21, G24, G32

Trade Credits and Bank Credits in International Trade: Substitutes or Complements?

“…In a robustness check, however, we use the logarithm of sales instead of the productivity measure. Additionally, we include the logarithm of the firm's tangible assets scaled by total assets to control for the firm's creditworthiness or availability of collateral (Gama and Mateus, ). Furthermore, we control for the sales growth of the firm to capture firm‐specific growth prospects.…”

“…Empirically, Gama and Mateus () find that in general, bank credits and supplier credits are substitutes. For smaller and younger firms, the substitution and complementary hypothesis are not mutually exclusive, however.…”

The Interdependence between Trade Credit and Bank Lending: Commitment in Intermediary Firm Relationships

“…First, they typically are restricted to financial institutions and suppliers as primary sources of external capital. Second, Portuguese SMEs tend to concentrate their borrowings at one or few financial institutions (Gama, Mateus, and Teixeira 2010). Consequently, the dependence on a Hausbank may lead to holdup problems (Farinha and Santos 2002).…”

Credit, misallocation and productivity growth: A disaggregated analysis

“…A relaxation of the borrowing constraint, i.e. an increase in the availability of credit reduces distortions in the first case and second case, 17 until the point in which the firm becomes unconstrained in the third case. Since inputs have to be purchased in advance of production, interest rates always introduce a wedge between the optimal and the actual input ratios.…”