The Effect of Inflation, Interest Rates, and the COVID-19 Pandemic on the Distribution of Banking Working Capital Loans in Indonesia Period 2017 – 2022

Abstract

The provision of working capital loans to business actors can maintain economic stability, and the credit conditions of banks influence the policies carried out by companies, especially companies that depend on bank loans to fulfill their working capital. This study aimed to look at inflation, interest rates, and the COVID-19 pandemic in influencing the variable distribution of banking working capital loans in Indonesia. The research was conducted using a quantitative study with research methods, namely multiple linear regression and the COVID-19 pandemic as a dummy variable. From the research that has been done, there are 13 results, including a significant positive effect of inflation on bank working capital lending for the period 2017 - 2022. Then, other results show that the interest rate variable significantly negatively impacts bank working capital lending for 2017 - 2022. Meanwhile, the COVID-19 pandemic did not significantly affect bank working capital lending. Overall, the variables in the model, namely inflation, interest rates, and the COVID-19 pandemic, significantly influence the distribution of bank working capital loans in Indonesia.