Research Information System
30th FAI International Conference on Emerging Trends of Digital Transformations, Computational Intelligence and Green Economy (30th FAI - ETDTCIGE 2025).24th - 28th April 2025. Baku, Azerbaijan. PROCEEDINGS BOOK, Baku, Azerbaijan, 24 - 28 April 2025, vol.1, no.1, (Unpublished)
Abstract. Debt refinancing is a widely used financial strategy that offers both advantages and disadvantages. On the one hand, this allows firms facing temporary financial difficulties to restructure their liabilities, as well as reduce interest payments and improve cash flow by reducing the cost of borrowing. On the other hand, debt refinancing can contribute to the zombification of firms, thereby weakening overall financial stability. To preserve the benefits of debt refinancing while mitigating its adverse effects, this paper proposes dividing the credit market into two segments: a debt market, where unviable firms can refinance their debts, and a trade credit market, where banks provide trade credit instead of loans; and to protect unviable firms from high interest rates that increase their real debt burden (adjusted for inflation) and thereby lead to their zombification, the paper proposes to establish an inflation-based ceiling on debt interest rates.