Title: Power distance and gender gap perception on the credit risk of rural banks: study of social and economic mission of Indonesian rural banks

Authors: Yavida Nurim; Nung Harjanto; M. Yudhika Elrifi; Indrian Supheni; Nur Rizki Wijaya; Angelia Pribadi

Addresses: Faculty of Economics and Business, Universitas Janabadra, Jl. Tentara Rakyat Mataram No. 55, Yogyakarta, 55231, Indonesia ' Department of Public Sector Accounting, Politeknik YKPN, Jl. Gagak Rimang No. 2, Balapan, Gondokusuman, Yogyakarta, 55222, Indonesia ' Faculty of Economics and Business, Universitas Janabadra, Jl. Tentara Rakyat Mataram No. 55, Yogyakarta, 55231, Indonesia ' Accounting Program, Universitas PGRI Mpu Sindok, Jl. AR. Saleh No. 21 Nganjuk, Jawa Timur, Indonesia ' Faculty of Economics and Business, Universitas Sebelas Maret, Jalan Ir. Sutami 36 A, Surakarta, Kota Surakarta, Jawa Tengah, Indonesia ' Faculty of Economics and Business, Universitas Janabadra, Jl. Tentara Rakyat Mataram No. 55, Yogyakarta, 55231, Indonesia

Abstract: The Indonesian government has been trying to accommodate the needs of the micro, small, and medium enterprises (MSMEs) for legal financing. Indonesian rural banks (IRBs) as private bank - have social and economic missions to accommodate it. Consequently, a good relationship between the IRB's management and its customers, namely MSMEs, impacts its financial performance. It is built from organisational culture, such as power distance and gender equity. This study uses primary data from a questionnaire and secondary data from IRBs' financial reports for 2016-2019. The smaller the gap between superiors and subordinates and the smaller the gap between genders will decrease the credit risk. A good atmosphere in an organization encourages the members to pursue the organisation's goal rather than the individual's. This study contributes to the cognitive social theory, namely the social environment around individuals, which plays a role in cognitive development and individual behaviour.

Keywords: power distance; credit risk; IRB; Indonesian rural bank; gender equality; social mission.

DOI: 10.1504/IJMEF.2025.148107

International Journal of Monetary Economics and Finance, 2025 Vol.18 No.2/3, pp.165 - 175

Received: 18 Aug 2023
Accepted: 04 May 2024
Published online: 25 Aug 2025 *

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