Collateral for Business Loans: Constraints and Conflicts regarding the Indigenous Culture of Bangladesh
Keywords:
Indigenous Business-owners, Bank Loans, Collateral, Culture, Bangladesh.Abstract
This research explores how a financing practice of the dominant society is contested in an indigenous context. Considering a traditional handloom business of indigenous women in a South Asian country, Bangladesh, this article investigates into the collateral practices in accessing bank loans. Based on an extensive literature review, it reveals that the normal practice of providing collateral places constraints for accessing loans and provides a scope for conflicts with dominant society. In so doing, it significantly extends the view beyond the issue of discrimination for the non-dominant society. The broader contribution of the paper is to underscore the impact of historical, traditional and cultural aspects on debt financing for small businesses.
References
Afzal, T. (2012). “Plugging the Loopholes in SME Financingâ€, The Daily Star, 24 April, pp. 6.
Aldene, H., Meis, M., Robert, B., Anderson, L., Paul, D. (2012). Inuit Culture and Opportunity Recognition for Commercial Caribou Harvests in the Bio Economy. Journal of Enterprising Communities: People and Places in the Global Economy, 6(3), pp. 194 –212.
Austin, B. J., Garnett, S. T. (2011). Indigenous Wildlife enterprise: Mustering Swamp Buffalo (Bubalus bubalis) in Northern Australia. Journal of Enterprising Communities: People and Places in the Global Economy, 5(4), pp. 309-323.
Avery, R. B., Bostic, R. W., Samolyk, K. A. (1998). The Role of Personal Wealth in Small Business Finance. Journal of Banking & Finance, 22, pp. 1019-1061.
Berger, A. N., Udell, G. F. (1995). Relationship Lending and Lines of Credit in Small Firm Finance. The Journal of Business. 68, pp. 351–381.
Binks, M. R., Ennew, C. T. (1996). Growing Firms and the Credit Constraint. Small Business Economics, 8, pp. 17–25.
Blanchflower, D., Levine, P., Zimmerman, D. (2003). Discrimination in the Small-Business Credit Market, The Review of Economics and Statistics, Vol. (4), pp. 930–43.
Brewer III, Genay, H., Jackson III, W., Worthington, P.R. (1996). How are small Firms Financed? Evidence from small business investment companies. Economic Perspectives, Federal Reserve Bank of Chicago, Chicago, IL, November-December, pp. 2-18.
Bruton, G. D., Ahlstrom, D., Obloj, K. (2008). Entrepreneurship in Emerging Economies: Where are we today and where the research should go in the future. Entrepreneurship Theory and Practice, 32, pp. 1-14.
Cassar, G. (2002). The Financing of Business Start-ups. Journal of Business Venturing. 19, pp. 261–283.
Chakma, D. (2012). “Accessibility of Financing in Handloom Sector: A Case Study of Rangamatiâ€, A MBA research paper submitted to Institute of Business Administration, Jahangirnagar University, Dhaka, Bangladesh.
Cole, R. A., Wolken, J. D., Woodburn, L. (1996). Bank and Nonbank Competition for Small Business Credit: Evidence from the 1987 and 1993 National Surveys of Small Business Finances. Federal Reserve Bulletin, November, pp. 983-995.
Coleman, S. (2004). Access to Debt Capital for Women- and Minority- Owned Small Firms: Does Educational Attainment have an Impact? Journal of Developmental Entrepreneurship, 9, pp. 127- 143.
Cruickshank, D. (2000). Competition in UK Banking: A Report to the Chancellor of the Exchequer. London: HMSO.
Curran, J., Blackburn, R. (1993). Ethnic Enterprise and the High Street Bank, Working Paper, Kingston Business School, Kingston University.
Dana, L. (2015). Indigenous Entrepreneurship: An Emerging Field of
Research. International Journal of Business and Globalization. 14(2), pp. 158-169.
Dzisi, S. (2008). Entrepreneurial Activities of Indigenous African Women: A Case of Ghana. Journal of Enterprising Communities: People and Places in the Global Economy, 2(3), pp. 254-264.
Fleming, A. E., Petheram, L., Stacey, N. (2015). Australian indigenous women’s seafood harvesting practices and prospects for integrating aquaculture. Journal of Enterprising Communities: People and Places in the Global Economy, 9(2), pp. 156-181.
Foley, D. (2008). Does Culture and Social Capital impact on the Networking Attributes of Indigenous Entrepreneurs? Journal of Enterprising Communities: People and Places in the Global Economy, 2(3), pp. 204-224.
Fraser, S. (2009). Is there Ethnic Discrimination in the UK Market for Small Business Credit? International Small Business Journal, 27(5), pp. 583-607.
Glenice, J. W., Marilyn, J. D. (2011). A Review of Male and Female Australian Indigenous Entrepreneurs: Disadvantaged Past – Promising Future? Gender in Management: An International Journal, 26(4), pp. 311 – 326.
Guha, S. (1985). The Agrarian Economy of the Bombay Deccan 1818- 1941. Delhi: Oxford University Press.
Gundry, L. K., Welch, H. P. (2001). The Ambitious Entrepreneur: High Growth Strategies of Women-owned Enterprises. Journal of Business Venturing, 16(5), pp. 453–470.
Holmstrom, B., Tirole, J. (1997). Financial Intermediation, Loanable Funds and the Real Sector, Quarterly Journal of Economics. 12(3), pp. 663–91.
Hutchinson, R. H. S. (1978). Chittagong Hill Tracts, Vivek Publishing, Delhi, India.
Jaim. J., Chakma, D. (2013). Collateral for Business Loans: Challenging the Indigenous Culture of Bangladesh. 6th ENQUIRE Postgraduate Conference, September 10-11, The University of Nottingham.
Jaim, J., Arefin, K. (2007). Quantum of Small Entrepreneurial Credit Granted against Application: An Analysis on Selected Private Commercial Banks in Mymensingh Pourashabha, The Jahangirnagar Review, 31(2), pp. 89-97.
Jaim, J. (2015). Problems of Undertaking Loan of Small Business- owners in Back-strap Handloom Sector: A Study on Rangamati District of Bangladesh, Journal of Entrepreneurship & Management, 4(1), pp. 28-33.
Jaim, J. (2011). Analyzing Problems of the Small Entrepreneurs for Loan Acquiring From Private Commercial Banks, Journal of Business Research, 13, pp. 41-48.
Jones, T., McEvoy, D., Barrett, G. (1994). Raising Capital for the Ethnic Minority Small Firm, in A. Hughes and D. Storey (eds) Finance and the Small Firm, pp. 145–181, London and New York: Routledge.
Khan, A. R. (2000). Entrepreneurship, Small Business and Lives of Successful Entrepreneurs, Ruby Publications, 1st Edition.
Kim, G. (2011). Minority Small-Firm Credit Applicants: Does Persistence Pay? The Journal of Entrepreneurial Finance. 15(2), pp. 91-106.
Kon, Y., Storey, D. J. (2003). A Theory of Discouraged Borrowers, Small Business Economics, 21, pp. 37-49.
Maria, B. (2012). Rethinking and Reshaping Indigenous economies: MÄori Geothermal Energy Enterprises. Journal of Enterprising Communities: People and Places in the Global Economy, 6(3), pp. 271 – 283.
Marlow, S., Patton, D. (2005). All Credit to Men? Entrepreneurship, Finance, and Gender. Entrepreneurship Theory and Practice, 29(6), pp. 717–735.
Mohsin, A. (2002). The Politics of Nationalism: The Case of the Chittagong Hill Tracts Bangladesh. Dhaka: The University Press Limited.
Moro, A., Lucas, M. R., Grimm, U. G. (2012). The Debt Structure of SMEs: An Optimization Model. The Journal of Entrepreneurial Finance, 16(1), pp. 87-108.
Peredo, A. M., Anderson, R. B., Galbraith, C. S., Honig, B., Dana, L. P. (2004). Towards a Theory of Indigenous Entrepreneurship. International Journal of Entrepreneurship and Small Business, 1(1/2), pp.1–20.
Petersen, M. A., Rajan, R. G. (1994). The Benefits of Lending Relationships: Evidence from Small Business Data. The Journal of Finance. Vol. 49, pp. 3–37.
Peter, W., Andrew, C. (2008). Tourism, Indigenous Peoples and Endogeneity in the Chatham Islands. Journal of Enterprising Communities: People and Places in the Global Economy, 2 (3), pp. 265–274.
Portes, A., Bach, R. (1985). Latin Journey: Cuban and Mexican Immigrants in the United States, University of California Press, Berkeley.
Riding, A. L., Haines, J.R.G. (2001). Loan Guarantees: Costs of Default and Benefits to Small Firms. Journal of Business Venturing, 16, pp. 595–612.
Roy, A. D. (2005). Indigenous Textile of the Chittagong Hill Tracts, Rangamati: Charathum Publishers.
Roy, R. D., Chakma, P., Lira, S. (Compiled) (2009). Compendium on National and International Laws & Indigenous Peoples in Bangladesh. Dhaka: Shrabon Prokashani.
Roy, R. D. (2009). The ILO Convention on Indigenous and Tribal Populations, 1957 (no. 107) and the Laws of Bangladesh: A Comparative Review, ILO Geneva: International Labour Standards Department, and Dhaka: ILO Office.
Sarder, J. H. (1990). Potentiality of Small Scale Industries in Bangladesh. The Dhaka University Studies, 9.
Schendel, W. (1992). Francis Buchanan in Southeast Bengal (1798): His journey to Chittagong, the Chittagong Hill Tracts, Noakhali and Comilla. Dhaka: The University Press Limited.
Smallbone, D., Ram, M., Deakins, D., Baldock, R. (2003). Access to Finance by Ethnic Minority Businesses in the UK, International Small Business Journal, 21(3), pp. 291–314.
Spencer, R., Brueckner, M., Wise, G., Marika, B. (2016). Australian Indigenous Social Enterprise: Measuring Performance. Journal of Enterprising Communities: People and Places in the Global Economy, 10(4).
Storey, D. J. (1994). Understanding the Small Business Sector, London: Routledge.
Swamy, A. V. (2010). Land and Law in Colonial India, available at
http://web.williams.edu/Economics/wp/SwamyLandAndLawInC olonialIndia.pdf (Accessed July 22, 2013).
Tapsell, P., Woods, C. (2008). Potikitanga: Indigenous Entrepreneurship in a Maori Context. Journal of Enterprising Communities: People and Places in the Global Economy, 2(3), pp. 192-203.
Ude´n, M. (2008). Indigenous Women as Entrepreneurs in Global Front Line Innovation Systems. Journal of Enterprising Communities: People and Places in the Global Economy, 2(3), pp. 225-239.
World Bank (2001). Draft Operational Policies (Op 4.10), Indigenous Peoples, The World Bank Group,
http://lnweb18.worldbank.org/ESSD/sdvext.nsf/63ByDocNam e/PoliciesDraftOP410March232001 (Accessed June 9, 2004).
