Debt Management Challenges of Selected Small and Medium-sized Enterprises in Lucena City

Debt management refers to the strategies and practices employed by individuals or business to manage borrowing and repayment of debt effectively. This research aims to determine the debt management practices of small and medium-sized enterprises (SMEs) in Lucena City. Specifically, it seeks to identify the background characteristics of these businesses, examine their debt. A descriptive research design was employed, utilizing questionnaires distributed to a minimum of thirty SME owners. This study analyzed various aspects of loan availability, including sources of borrowing, average loan amounts, types of loan commonly available, and the purpose of securing loans. it also examined debt repayment practices, such as budgeting, knowing loan details, prioritizing payments, loan consolidation, and the sinking fund method, revealing common challenges related to loan applications, repayment periods, amount involved, and borrowing costs. These findings underscore the importance of effective debt management for the financial health and sustainability of SMEs. By providing a comprehensive overview of efficient debt management techniques, this research offers valuable insights for SME owners and managers, enabling them to make informed decisions regarding borrowing and debt payment.