Debt Financing Management: The Modes of Debt Financing for Small and Medium-Sized Enterprises (SEMs) in Pakistan

  • Waseem Ul Hameed The Islamia University of Bahawalpur, Pakistan.
  • Hisham Bin Mohammad Universiti Utara Malaysia (UUM), Malaysia.
  • Javed Iqbal The Islamia University of Bahawalpur, Pakistan.
  • Shazma Razzaq Universiti Utara Malaysia (UUM), Malaysia.
  • Nadeem Maqbool The Islamia University of Bahawalpur, Pakistan.
Keywords: SMEs, Debt Financing, Financial Institutes, Islamic Bank, Commercial Bank

Abstract

Purpose – The basic purpose of this paper is to analyze the debt financing of small and medium-sized enterprises (SMEs) in Pakistan through different modes from conventional and non-conventional (Islamic) institutes.

Design/Methodology/Approach – Data is publicly available on databases and websites about debt financing of small and medium-sized enterprises (SMEs) of Pakistan, thus data is collected from these databases and websites in the form of articles and handbooks about Pakistan.

Findings – It is found from the analysis that a lot of financing choices and modes are available for small and medium-sized enterprises (SMEs) in Pakistan. These modes are provided by both conventional and non-conventional (Islamic) financial institutes. All the debt modes are discussed in the paper. In addition, there are some drawbacks of debt financing that arises from conventional and non-conventional (Islamic) financial institutes, which alleviate small and medium-sized enterprises (SMEs) from adopting these modes

Research Limitations/Implications – Some financial institutes, especially banks, lack knowledge and information about small and medium-sized enterprises (SMEs) in Pakistan. Banks could lessen it by acting as a mediator for small and medium-sized enterprises (SMEs).

Originality/Value – This review paper's main contribution is to analyze the contribution of financial institutes in debt financing small and medium-sized enterprises (SMEs) in Pakistan. Paper discusses all the modes available for the small and medium-sized enterprises (SMEs) in Pakistan thoroughly through conventional and non-conventional (Islamic) financial institutes.

Author Biographies

Waseem Ul Hameed, The Islamia University of Bahawalpur, Pakistan.

Assistant Professor, School of Business, Management and Administrative Sciences (SBM&AS), Department of Islamic and Conventional Banking (ICB). 

Hisham Bin Mohammad, Universiti Utara Malaysia (UUM), Malaysia.

School of Economics, Finance and Banking (SEFB).

Javed Iqbal, The Islamia University of Bahawalpur, Pakistan.

Deputy Director (Audit).

Shazma Razzaq, Universiti Utara Malaysia (UUM), Malaysia.

School of Languages, Civilization, and Philosophy (SLCP).

Nadeem Maqbool, The Islamia University of Bahawalpur, Pakistan.

School of Business, Management and Administrative Sciences (SBM&AS).

Published
2020-12-31
How to Cite
Hameed, W. U., Mohammad, H. B., Iqbal, J., Razzaq, S., & Maqbool, N. (2020). Debt Financing Management: The Modes of Debt Financing for Small and Medium-Sized Enterprises (SEMs) in Pakistan. IRASD Journal of Management, 2(2), 56 - 68. https://doi.org/10.52131/jom.2020.0202.0016