The Effects of Leasing Finance to Create Income and Employment Opportunities by Advancement of Micro, Small and Medium Enterprises: An Analysis
Keywords:
Lease Finance, Financial Performance, Income, Employment, Economic Growth, developmentAbstract
In advanced and developing economies leasing finance is recognized as an alternative medium and long-term financing source for large to micro, small, and medium businesses, the agriculture sector, empowering women, setting up new business ventures, balancing, modernizing, and replacement activities. The analysis is carried out to find out the economic impact of leasing finance activity in the country from the angle of supply provider (i.e., the financial health of leasing Companies) and demand side (i.e., effects of leasing financing on SMEs). The regression method was adopted to analyze the relationship between input and output factors of the progress of the leasing business over the period 2010 to 2018, and 300 small and medium enterprises. Simultaneously, when it was examined through the significant financial ratio to ascertain the potential of leasing finance it was found that it can be utilized furthermore. The empirical result (P= 0.110) and borrowing and financial charges have a negative correlation with the profitability of the firms which indicates a decline in business activities. Thus, it doesn't stretch out a compelling advantage to the investors to grow business exercises. The test result P=<0.01 of the SMEs shows growth in business performance is due to the involvement of leasing finance activity on the other hand.
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