Determinants of Non-Performing Loans with External Audit as a Moderation Variable

Abstract

In the early era of the pandemic, conditions for MSME financing in non-bank financial institutions experienced a decline due to the many economic impacts that occurred due to the COVID-19 pandemic. Many MSMEs are experiencing difficulties in terms of liquidity and business capital needs, so that demand for credit from financial institutions that do not meet banks has decreased drastically. Apart from that, non-bank financial institutions also experience difficulties in providing financing due to increasingly high credit risks. The phenomena and dynamics faced by MSMEs during the Covid-19 pandemic are the background for this research. This research uses quantitative descriptive research. Based on the research results, it was found that the number of debtors and loan size had no effect on the NPF. There is a positive influence of BOPO, ROE on NPF. Furthermore, the KAP audit does not strengthen the influence of loan size on NPF. Meanwhile, KAP Audit strengthens the influence of BOPO, ROE, and Number of Debtors. The R square value shows 0.925, which means the influence of the independent variables together on the dependent is 92.50%.