Situational analysis and prospect of interest-free financing in tapioca agro-industry

Abstract

Tapioca agro-industry is one sector that needs to be developed into a competitive industry as currently there are many users of its derivative products. However, its development deals with limited access to finance. The purpose of this study is to describe condition of tapioca agro-industry and its prospect of interest-free financing. This research is a review of previous studies discussing about the relevant topic. Review was undertaken through descriptive analysis on a number of related literature and was in accordance with availability of secondary data. Results of the study have provided information on condition of tapioca agro-industry and prospect of reinstating the interest-free financing through development of a partnership-financing model of tapioca agro-industry. This partnership model has some other advantages in addition to interest-free, such as collateral-free and profit-and-loss agreements that are mutually agreed among involved parties to minimize the gap between capital owners and business owners.