Does ICT adoption improve access to credit for small enterprises?

Lucia Dalla Pellegrina (), Serena Frazzoni, Zeno Rotondi and Andrea Vezzulli ()
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Lucia Dalla Pellegrina: University of Milano-Bicocca
Serena Frazzoni: UniCredit
Zeno Rotondi: UniCredit

Small Business Economics, 2017, vol. 48, issue 3, No 11, 657-679

Abstract: Abstract Using data at the bank–firm level collected through the 9th UniCredit Survey conducted in 2012 on a large sample of small businesses, we investigate the extent to which a large international bank offers better credit conditions to enterprises that use ICT more extensively. The results, which are robust to selection and endogeneity issues, show that banks tend to grant increasing volumes of credit to such enterprises. We interpret this evidence as the ceteris paribus effect of ICT adoption by small businesses on the quality of information transmitted to banks. Another possible interpretation is that banks consider ICT adoption as a signal of firms’ willingness to innovate. We also discuss implications concerning the key role that technology plays in changing the ‘arm’s length’ versus ‘relationship’ lending paradigms.

Keywords: ICT adoption; SMEs; Bank–firm relationship; Asymmetric information; G21; L25; O31; L26 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (20)

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DOI: 10.1007/s11187-016-9794-x

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