IDEAS home Printed from https://ideas.repec.org/a/ids/ijbpma/v27y2026i8p14-35.html

Debt management in the construction business for the prevention of non-performing loans

Author

Listed:
  • Watcharin Areerart
  • Thanin Silpcharu
  • Sunee Wattanakomol

Abstract

This study investigates debt management strategies to prevent non-performing loans (NPLs) in the construction industry and develops a structural equation model (SEM) based on empirical evidence. Although construction is vital to economic development, rising financial risks have increased NPLs, particularly among SMEs, threatening liquidity, institutional stability, and project sustainability. To address the lack of frameworks for construction-sector debt management, a mixed-methods approach was employed, including interviews with 9 experts, focus groups with 11 specialists, and a survey of 500 executives. Data were analysed using descriptive, inferential, and multivariate statistics. Four key factors influencing NPL prevention were identified: strategic prudence and balanced operational management, process improvement, business opportunity development, and risk control. Business duration significantly affected debt management practices (p = 0.05). The SEM demonstrated excellent fit (χ2 = 0.090, relative χ2 = 1.090, GFI = 0.941, RMSEA = 0.013), confirming its validity and applicability for strengthening resilience and informing policy.

Suggested Citation

  • Watcharin Areerart & Thanin Silpcharu & Sunee Wattanakomol, 2026. "Debt management in the construction business for the prevention of non-performing loans," International Journal of Business Performance Management, Inderscience Enterprises Ltd, vol. 27(8), pages 14-35.
    • Handle: RePEc:ids:ijbpma:v:27:y:2026:i:8:p:14-35
    as

    Download full text from publisher

    File URL: https://www.inderscience.com/link.php?id=157274
    Download Restriction: Open Access
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:ijbpma:v:27:y:2026:i:8:p:14-35. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=3 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.