Development of A Credit Score For Small And Medium Enterprises

Abstract

This research aims to develop indicator and criteria for the credit scoring for small and medium enterprises business (SMEs) which appropriate to the SMEs and analyzes the validity of the Index of Item Objective congruence: IOC were applied for the research. The research results as follows:

1. Criteria for the classification of SMEs have business credit 4 fields 20 indicators for example Liquidity Field 8 indicators consist : Current Ratio, Quick Ratio Average, Collection Period, Inventory Turnover Average Sale goods Period, Account Payable Turnover and Average Payment Period , Profitability Field 4 indicators consist : Gross Profit Margin ,Operating Profit Margin ,Net Profit Margin and Return on Equity , Efficiency 3 indicators consist : Return on Asset: ROA, Return on Fixed Asset and Total Assets Turnover, Financial policy Field 5 indicators consist : Debt to Equity Ratio, Interest Coverage ,Debt to Total Asset Ratio, Operating to Total Income Ratio and Interest expense to total Income Ratio.

2. Results of analyzes the validity of content show that every indicator suitable for credit scoring of the business SMEs appropriately.