Access to Finance

High-tech innovative SMEs’ development plays crucial role in economic growth of every country. It creates new work places and infrastructure, motivates people for creating new ideas. At the same time, SMEs still face with a huge number of problems in the business performance. The purposes of the research are: to define main barriers for high-tech SMEs’ development in the 4th industrial revolution era (4IR); to work out recommendations for policy-makers towards intensification of SMEs’ potential.
For this purpose, the authors reviewed studies devoted to the SMEs’ innovative development and revealed that main barriers of SMEs’ development are related to inefficient government support in this sphere. In order to work out recommendations for Ukrainian policy-makers in the area of SMEs’ development, the authors conducted a survey of local high-tech SMEs and on the basis of SWOT-analysis distinguished the main directions for their further improvement. Finally, a set of recommendations for improving SMEs’ environment in Ukraine, taking into consideration the challenges of the 4th IR, was developed.

Moroccan SMEs do not use generally capital market due to rigidity of the conditions. Moroccan authorities have introduced the measurements to deal with this problem and to encourage SMEs to access in the capital market since 2000. However, these measures were less efficient because they are multiple reason, but indeed, it still attributed to the financial and institutional conditions of access to capital market. The article target is to analyze capital market reforms and its contribution to financing Moroccan SMEs. In order to help us to determine the constraints of access the SMEs to direct finance. In fact, to achieve the target we need to adopt a methodology based on the analysis of secondary statistics and official reports of the main actors of the capital markets in Morocco. Résumé Dans plusieurs études sur le financement des PME marocaines, il est constaté que cette catégorie d'entreprises ne recourent que très faiblement aux marchés de capitaux. Afin de faire face à cette problématique, les autorités marocaines ont mis en place une panoplie de mesures depuis le début des années 2000. Malgré les efforts déployés, le troisième compartiment de la bourse de Casablanca ne comporte qu'un nombre très limité de PME. Les causes sont, en effet, multiples mais, sont toujours imputées aux conditions financières et institutionnelles d'accès aux marchés de capitaux. L'objectif de cet article est d'analyser l'ampleur des réformes des marchés de capitaux et leurs apports au financement des PME marocaines. Pour atteindre cet objectif, nous adoptons une méthodologie fondée sur l'analyse des statistiques

The purpose of this report is to raise attention to the constraints that presently restrict the provision of finance in Southern Sudan, and recommend actions that would stimulate the development of the sector as well as a more broad based provision of financial services.

The main providers of financial services in Southern Sudan consist of five commercial banks and six or so microfinance agencies, while a sprinkling of foreign exchange agencies provide foreign exchange and transfer services, six insurance agencies provide a range of insurance services. The commercial banks provide loans, advances and trade finance, but their lending portfolio (63 Million SDG according to the Bank of Southern Sudan’s December 2008 reports) covers only a meagre 7% of the approx. 6000 registered firms and less than 1 % of the Government of Southern Sudan’s revenue. Similarly, the microfinance agencies estimate that their microloan portfolio (9 Million according to self reported figures) only services 5% of the available clients in the greater Juba region, and less than 1% of the potential market in Southern Sudan. Further, the financial sector only provides finance in urban hubs, focuses primarily on the non-productive sectors (such as trade, construction and hotel services, etc.), and only dedicates 10 % of its loan portfolio to small firms (loans between 1000 and 100,000 USD) in Southern Sudan. The financial sector is clearly small and underdeveloped.

The main issues hampering the depth and breadth of provision by commercial banks are not the lack of liquidity, but (1) the lack of competition, and the poor capacity of local banks (in terms of credit analysis skills, controls, systems, management capacity and corporate governance), (2) the lack of collateral due to the frail structures for land registry and a nascent legal, regulatory and enforcement framework, and (3) the specific characteristics of businesses in Southern Sudan. Credit is rationed according to the high risk and the low ability to recover assets – excluding certain sectors and company types with low short-term cash flows and collateral.

Recommendations to enhance the provision of finance by commercial banks include (1) the entry of new banks in coordination with an escalated support to BOSS (for banking supervision) as well as to the local banks (in terms of capacity building), (2) the development of legal, regulatory and enforcement frameworks for lending technologies that match the client characteristics of businesses in Southern Sudan, and (3) the improvement in the financial transparency of businesses (audits, credit bureaus, business training) in coordination with the development of alternative lending technologies that are better suited to the client characteristics of businesses in Southern Sudan (guarantee/ subsidy provision, group lending structures, fixed asset lending, leasing models, factoring and asset based lending, etc). The establishment of an insurance commission might also heighten their ability to access loans from the commercial banks.

This report thus presents a set of recommendations to enhance the provision of finance of microloans by microfinance agencies, and individual loans as well as medium scale loans for trade finance (in terms of LOCs), as working capital for business expansion, and bridge finance to assist in the purchase of fixed assets (overdraw facilities). It is important to note that these recommendations would not enhance the provision of large-scale loans for agricultural finance, investment into manufacture, and real estate, and the demand for start up capital by local Sudanese firms. These would best be met by nor would be better addressed by public private partnership or through alternative support systems.

Given that some of the recommended actions will take several years to implement successfully (e.g. the availability of land as properly registered collateral), a short run strategy to address the financing needs of businesses would be ideal. Accordingly, an investigation into associated methods of reducing the lack of financial transparency of businesses in Southern Sudan (audits, credit bureaus, business training) as well as appropriate alternative lending technologies that are better suited to characteristics of businesses in Southern Sudan (lack of collateral, etc) would be timely. This report, as well as the subsequent investigation would thus pave the way for the development of innovative structures to address the specific access to finance issues in post conflict countries.

The small and medium-sized enterprises (SMEs) play an important role for economic growth in Vietnam. Access to finance is necessary in order to initiate, operate, develop and facilitate growth conditions of all businesses. Therefore, this study aims to determine factors affecting access to finance of SMEs in Vietnam. The study adopted a survey research design that employed a stratified random sampling. The primary data was collected from 400 SMEs via structured questionnaires. The Cronbach's Alpha testing methods, the exploratory factor analysis (EFA), ANOVA analysis and multivariate linear regression analysis were used in this study. The study results indicate that there are six factors significantly affecting access to finance of SMEs in Vietnam including managerial experience, the owner-manager's financial literacy, business plan, financial management regulations, the owner-manager's education and business size.

The household enterprise sector has a significant role in the Tanzanian economy. It employs a larger share of the urban labor force than wage employment, and is increasingly seen as an alternative to agriculture as a source of additional income for rural and urban households. The sector is uniquely placed within the informal sector, where it represents both conditions of

With the flagship success of M-Pesa, mobile devices have become an important tool to facilitate the financial inclusion of the previously unbanked population in developing countries. Following the success of M-Pesa in Kenya in 2007, mobile money technologies became widespread across Africa. Beginning in 2009, Ghana experienced exceptional adoption of Mobile Money technology. Many studies have examined the influence of mobile money on financial inclusion from a variety of perspectives, and many have concluded that mobile money is a game-changer in this regard. The Mobile Money concept has evolved based on introducing the other value-added services such as microloans, savings, and insurance portfolios. The researcher used a questionnaire and a face-to-face interview to obtain qualitative data for this study. Together with other research, the statistics revealed that Mobile Money transactions in Ghana had more than tripled since it became the most popular payment method. Over the last year, the platform as a service has created over 140,000 jobs and has shown to be the safest channel. It has several advantages, including lowering the cost of printing and keeping cash on hand, as well as decreasing fraud because the technology underlying it gives appropriate audit trails to prevent fraud and boost economic growth.

The intensity of recent turbulence in financial markets has surprised nearly everyone. This paper searches out the root causes of the crisis, distinguishing them from scapegoating explanations that have been used in policy circles to divert attention from the underlying breakdown of incentives. Incentive conflicts explain how securitization went wrong, why credit ratings proved so inaccurate, and why it is

The banking sector comprises of 49 institutions, 42 of which are commercial banks, 3 mortgage finance companies, one non-bank financial institutions and one building society as at December 2008, according to CBK annual reports. Despite the long existence of commercial banks in Kenya, local, international and multinational, they have shied away from lending to small-scale businesses. It is a well-established fact that access to finance is a major determinant of economic growth (Beck, Levine, and Loayza, 2000). Therefore, access to finance, which has been one of the core topics in development for quite some time, has emerged on the agenda of nearly all governments. The important policy question is: what measures must be taken to foster access to finance? This study therefore attempted to find out lending conditions by commercial banks that affect small-scale business in Kisii County. The study found out that competition, pricing, Commercial banks tight bank requirement as important factor that affect accessibility of loans by SMEs by commercial banks. The study concludes that Majority of the population are locked out of the formal financial sector due to the many strict requirements and stringent conditions required by the banks for one to open an account or access credit because their information is not captured. Consequently, the study recommends that CBK should influence the interest rate.

Using a large variety of firm-level information, including survey data on ac-cess to finance of non-financial companies, we offer an insightful perspective on credit demand, focusing on Romanian SMEs segment. The information from this tool was combined with the results from the Bank Lending Survey which also captures the supply-side perspective.
We show that, according to both surveys, SMEs lending market was highly affected by the impact of the recent turmoil, a full recovery of banks’ appetite towards this segment being yet to be reached. At the same time, companies’ interest for bank loans is subdued, the cost of funding being restrictive especially in case of small firms.
A main challenge for credit institutions over the coming period is a better exploitation of firms with viable indebtedness potential, especially activating in sectors which can change the economic growth pattern (including trade loans).
For attracting SMEs interest for bank loans, flexible and tailored made prod-ucts are needed, as well as a simplification of lending process. At the same time, increasing staff training and qualifications related to project financing and firms’ counseling could be a solution for boosting lending, as well as increasing the role of guarantee and counter-guarantee funds. Reducing information asymmetries in SMEs lending system could contribute to a better functioning of SMEs loan market.

The importance of small and medium enterprises (SMEs) and their economic contribution is acknowledged globally. Although SMEs in developed economies have become fairly competitive, their counterparts in the emerging economies have struggled in the rapidly evolving external environment. The objective of this study is to present a conceptual framework for SMEs in emerging economies targeted to raise their performance. Literature indicates that the low skill level of human resource and the lack of emphasis on knowledge management are the major factors behind the struggle of SMEs to establish themselves in emerging economies. Earlier studies have discovered a positive impact of knowledge management and human capital in raising SMEs' performance. Literature also indicates that the influence of knowledge and human capital within SMEs' performance varies due to the prevailing competitive conditions. Therefore, this study proposes a conceptual framework to leverage the performance of SMEs in emerging economies and examines how this relationship may vary when it interacts with the competitive environment.

Modern energy access in Africa is critical to meeting a wide range of developmental challenges including poverty reduction and the Millennium Development Goals (MDGs). Despite having a huge amount and variety of energy resources, modern energy access in the continent is abysmal, especially Sub-Saharan Africa. Only about 31% of the Sub-Saharan African population have access to electricity while traditional biomass energy accounts for over 80% of energy consumption in many Sub-Saharan African countries. With energy use per capita among the lowest in the world, there is no doubt that Africa will need to increase its energy consumption to drive economic growth and human development. Africa also faces a severe threat from global climate change with vulnerabilities in several key areas or sectors in the continent including agriculture, water supply, energy, etc. Low carbon development provides opportunities for African countries to improve and expand access to modern energy services while also building low-emission and climate-resilient economies. However, access to finance from different sources will be critical in achieving these objectives. This paper sets out to explore the financial instruments available for low carbon energy access in Africa including the opportunities, markets and risks in low carbon energy investments in the continent.► Access to finance will be critical to achieving low carbon energy access in Africa. ► Domestic finance will be important in leveraging private finance. ► Private sector participation in modern and clean energy in Africa is still low. ► Many financing mechanisms exist for low carbon energy access in Africa. ► The right institutional frameworks are critical to achieving low carbon energy access in Africa.

Agricultural value chain financing (VCF) is an emerging phenomenon in the region but it is not well studied. Historically, small- and medium-sized famers experience problems accessing formal finance. Participation in a well-structured and dynamic supply chain seems to improve chances of obtaining financing, either directly from larger more liquid agents in the same chain or indirectly from external formal lenders