“SMEs are the private sector of developing countries” and financing their development is crucial, said Prof Thorsten Beck, from Cass Business School, at a seminar organised by the EIB Group (EIB, EIF and EIB Institute) as part of EIB SME Week.
The challenge is that there is no one-size-fits-all model as SMEs are of different sizes (micro-enterprise, small or medium-sized business) and at different stages of development, he added. There are also different financial service providers (banks, MFIs, private funding, alternative financing platforms, capital markets), as well as different lending techniques and complementary services (technical training, business development).
It is therefore essential to “provide the market with a helping hand”, notably to address demand-side constraints, by using various policy levers for long-term institution-building and to promote competition and innovation, he concluded.
Click here for presentation.