How May Banks Address the Constraints and Perceived Drawbacks to Financing SMEs?

David Munro

Chapter 3 in A Guide to SME Financing, 2013, pp 18-31 from Palgrave Macmillan

Abstract: Abstract SMEs often lack adequate financial records, have insufficient collateral, and non-professional management (they are often family enterprises). Unless a cost-conscious lending methodology is adopted, transaction costs can exceed earnings on the small loans many SMEs require. Mitigation strategies for these risks are discussed at length, including instructions on how to assemble financial statements using account turnover information and industry averages. These approaches are part of the template-driven methodology advocated in the Guide. Elements of the semi-automated approach are described in detail within the context of a risk-mitigation strategy.

Keywords: Balance Sheet; Operating Expense; Income Statement; Credit Score; Loan Application (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-37378-6_4

Ordering information: This item can be ordered from
http://www.palgrave.com/9781137373786

DOI: 10.1057/9781137373786_4

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().