Identify Factors That Influence Non-Performing Loans After Green Finance Policy Applied

Az Zahrah Aulia Putri, Sri Andaiyani, Ariodillah Hidayat

Abstract


This study examines the effects of implementing Green Credit Policy, Loan Interest Rates and Net Domestic Credit in overcoming the Risk of Non-Performing Loan. Emerging Markets countries are very interesting to discuss because their high financial volatility is prone to financial crises. The variables used in this research include: Green Credit, Lending Interest Rate and Net Domestic Credit. The type of data is secondary data with a research time span (2013 - 2022) sourced from the World Bank and the Central Bank Websites of each country. The object studied is the Emerging Markets Country Block which focuses on Indonesia, Russia, Turkey, Brazil, China and India. This research analysis uses the Pooled EGLS (Cross-section SUR) regression technique with the FEM (Fixed Effect Model) model. The results of this research show that the Green Credit variable has a negative and significant relationship to the Non-Performing Loans variable in these 6 countries, 2 other variables, namely Lending Interest Rate and Net Domestic Credit, have a significant effect and have a positive relationship to the Non-Performing Loans variable in 6 Emerging Markets Countries

Keywords: Non-Performing Loans, Credit Policies, Green Credit, Green Finance, Emerging Markets


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