Berzhanir Inna, PhD in Economics, Associate Professor of the Department of Finance, Accounting and Economic security, Pavlo Tychuna Uman State Pedagogical University, Uman, Ukraine

ORCID ID: 0000-0001-7035-1170
e-mail: innaberzhanir@ukr.net

Bank Lending: Current State and Prospects for Development

Abstract. Introduction. It is established that the need for credit in a market economy is due to the patterns of capital circulation in the process of expanded reproduction, and the main advantages of using borrowed capital to finance working capital of an enterprise are determined.

Purpose. The aim of the article is to study the theoretical and methodological foundations and substantiate practical proposals for improving bank lending to agricultural enterprises.

Results. The article examines and explores the state of bank lending in modern conditions of the national economy of Ukraine. Changes in the structure of credit investments are analyzed. The analysis of the main reasons for the increase in interest rates on loans. Actual problems that affect the development of bank lending are considered, and the main directions for improving bank lending to agricultural enterprises are identified.

Conclusions. To develop bank lending and create financial stability it is necessary:

• make banking services better to improve their competitiveness;
• set limits on interest rates on loans within state acts and monitor its implementation;
• to raise the level of the banking sector by attracting additional share capital;
• stimulate commercial banks to lend to innovative projects;
• increase the capital resources of state-owned banks, increase their number and strengthen their role in the financial and credit market in Ukraine, etc. These measures will contribute to the recovery of the national economy and improve the overall condition of banking institutions. It is necessary to create an effective mechanism for improving the lending policy of agricultural enterprises by banks in order to improve the financial sector and increase the rate of economic growth in Ukraine.

Keywords: bank loan; interest rate; bank lending; working capital; borrowed capital.

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