Influence of Firm-Specific Variables on Capital Structure Decisions: An Evidence from the Fintech Industry

Capital structure (Capstr) decisions have always been a concern for firms. It is crucial to decide the right proportion of borrowed funds for any organisation. This study examines the influence of firm-specific variables that determine the Capstr decisions of firms from the fintech industry. The data for this study is sourced through the Refinitiv Database consisting of the worldwide fintech industry. The selected sample consists of 186 firms from across the global fintech industry. Through a quantitative approach, we have used panel regression, supported by descriptive statistics and correlation, considering the annual financial published data of the selected firms for a period from 2011 to 2021. The data used in the study comprises of an unbalanced and a cross-sectional data of 1000 firm/year observations, imported from the selected 186 firms. The findings conclude that the firm size (FS), profitability (Prft), tangibility ratio (Tr) and volatility (Vol) have a significant impact on Total debt ratio (TDr) and Short term debt ratio (SDr), However only profitability (Prft) has a significant impact on Long term debt ratio (LDr). The study partially approves to be in agreement to the pecking order theory for the studied industry.