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Understanding the perceived business obstacles and determinants of credit adoption by textile firms: evidences from World Bank’s enterprises survey

Sanjeet Singh (University Centre for Research and Development, Chandigarh University, Punjab, India)
Mitra Amini (School of Management, Bennett University, Greater Noida, India)
Mohammed Jamshed (Department of Management, Jamia Hamdard, New Delhi, India)
Hari Prapan Sharma (Institute of Business Management, GLA University, Mathura, India)
Waseem Khan (Department of Management, Jamia Hamdard, New Delhi, India)

Research Journal of Textile and Apparel

ISSN: 1560-6074

Article publication date: 18 April 2023




The purpose of the study is to examine the obstacle in doing business and determinants of credit adoption by the textile enterprises in India.


The study is based on World Bank’s Enterprises Survey, there are 571 enterprises involved in textile business. The enterprises survey has response on wide range of business obstacles which are categorized under three broad categories, namely, access to resource, business regulations and market externalities. Chi-square test and analysis of variance (ANOVA) have been used to examine the significant difference among firm’s profile and perceived business obstacles across the firm size. Furthermore, binary logistic regression model has been applied to explore the determinants of credit adoption by textile enterprises.


A statistically significant difference has been found in size of firms and legal status nature of establishment, gender of top manager, main product market and credit adoption from financial institutions. Majority of small- and medium-sized enterprises (SMEs) are sole proprietorship firm while large enterprises are limited partnership firms. Similarly, large enterprises have relatively more female as a top manager and international market for their product. ANOVA reveals equal degree of obstacles in doing textile business across the firm size. The logistic regression coefficient and marginal effects reveal that firm size, main market,gender of owner, number of establishment in the firms positive and significantly affects the credit adoption by 3 textile enterprises.

Practical implications

The study has some policy implications for various stakeholders such as textile business managers and promoters, government, investors and bankers for entrepreneurship development in textile sector. The study suggests that the government should incentivize small- and medium-sized businesses to increase their exports. The results show that despite government efforts to finance SMEs, fewer SMEs are receiving both short- and long-term credit. To help SMEs in the textile industry overcome financial difficulties and expand their main product market to both domestic and international levels, a soft loan should be provided based on the characteristics of textile enterprises.


The present study suggests the evidence-based understanding of textile business environment. The value and uniqueness of this study is to explore an ease of business textile sector using comprehensive enterprises survey data of World Bank.



Declaration of conflicting interests: The authors declare that there is no conflict of interest.


Singh, S., Amini, M., Jamshed, M., Sharma, H.P. and Khan, W. (2023), "Understanding the perceived business obstacles and determinants of credit adoption by textile firms: evidences from World Bank’s enterprises survey", Research Journal of Textile and Apparel, Vol. ahead-of-print No. ahead-of-print.



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