Effects of Interventions to Improve Access to Financial Services for Micro, Small, and Medium‐Sized Enterprises in Low‐ and Middle‐Income Countries: An Evidence and Gap Map

Nina Ashley O. Dela Cruz, Alyssa Cyrielle B. Villanueva, Lovely Tolin, Sabrina Disse, Robert Lensink and Howard White

Campbell Systematic Reviews, 2025, vol. 21, issue 3

Abstract: Micro, small, and medium‐sized enterprises (MSMEs) account for most firms in most economies, particularly in developing nations, and are key contributors to job creation and global economic development. However, the most significant impediment to MSME development in low‐ and middle‐income countries is a lack of access to both investment and working capital financing. Due to a lack of essential track record, appropriate collateral, and credit history, MSMEs are frequently denied business loans by traditional lending institutions. In addition, MSMEs face institutional, structural, and non‐financial factors that further impede access to funding. To address this, both public and private sectors employ indirect and direct finance interventions to help MSMEs in developing and emerging economies enhance and increase their financing needs. Given the importance of MSMEs in the economy, a comprehensive overview and systematic synthesizing of the evidence of the effects of financial access interventions for MSMEs, capturing a wide variety of outcome variables, is useful. The objective of this evidence and gap map (EGM) is to describe the existing evidence on the effects of various interventions dedicated to supporting and improving MSMEs' access to credit, as well as the corresponding firm performance and/or welfare outcomes. An EGM is a systematic evidence product that displays the existing evidence relevant to a specific research question. To better understand the various interventions dedicated to supporting and improving MSMEs' access to credit, as well as their outcomes, we conducted electronic searches in databases using various search strings. This search strategy was supplemented with gray literature searches and systematic review citation tracking to ensure that the research team had identified a significant portion of relevant research works. We included studies that examined interventions aimed at enhancing MSMEs' access to finance in low‐ and middle‐income countries, targeting MSMEs including households, smallholder farmers and single person enterprise, as well as financial institutions/agencies and their staff. This EGM considered five types of interventions: (i) strategy, legislation and regulatory; (ii) financing systems and institutions; (iii) access facilitation; (iv) lending instruments or financial products; and (v) demand‐side programs for financial literacy. On the other hand, the EGM also covered outcome domains for policy environment, financial inclusion, firm performance, and welfare. Both impact evaluations and systematic reviews of relevant interventions for a previously defined target population were included in this EGM, whether they had experimental or non‐experimental designs. We considered studies that were completed or in progress. All eligible studies included a suitable comparison group for interventions. For practical reasons, studies were limited to papers written in English, with no restrictions by publication date. Before‐and‐after study designs with no suitable comparison group were excluded from the study, as well as literature reviews, key informant interviews, focus group discussions, and descriptive analyses. The result of our study is outlined in this study article, as well as an interactive map drawn as a matrix of various interventions improving MSMEs' access to finance and their corresponding firm performance and/or welfare outcomes. The preliminary map was produced in March 2022 and after adding supplementary research the updated map and analysis started in April 2022. The final interactive map is available online. The EGM includes 413 studies. One hundred and forty‐seven studies featured interventions that targeted multiple firm sizes, though most (379 studies) analyzed microenterprises, such as households and smallholder farmers. One hundred and nine studies analyzed small and medium enterprises, while seven studies analyzed community groups. Lending instruments/financial products are the most common form of intervention across all firm types, with microenterprises most often receiving the said financial intervention (278 studies). This is followed by systems and organizations (138 studies) that support better access to such financial products and services. Welfare outcomes have the most evidence out of all the outcomes of interest, followed by firm performance and financial inclusion. Welfare outcomes refer to economic, food security and nutrition, health, education, housing, well‐being, and gender outcomes. Among all firm types, welfare outcomes are primarily targeted at microenterprises. With 59 studies, we can say that small businesses have a significantly large number of enterprise performance outcomes. Of the 413 studies, 243 used non‐experimental or quasi‐experimental designs (mainly propensity score matching and instrumental variable approaches), 136 used experimental methods, and 34 were systematic reviews. 175 studies (43%) provided evidence from Sub‐Saharan Africa, 142 studies (35%) from South Asia, 86 studies (21%) from East Asia and the Pacific, 66 studies (16%) from Latin America and the Caribbean, 28 studies (7%) from Europe and Central Asia, and 21 studies (5%) from the Middle East and North Africa. Most of the evidence included covers low‐income (26%) and lower‐middle income countries (66%), and to a lesser extent upper‐middle‐income countries (26%). This map depicts the existing evidence and gaps on the effects of interventions to enhance MSMEs' access to financial services in low‐ and middle‐income countries. Interventions directed at microenterprises with welfare outcomes have a significant number of research outcomes in the literature. SME evaluations have looked at firm performance, with less focus on employment and the welfare effects on owners and employees, including poverty reduction. Microcredit/loans have been the focus of a large number of research papers (238 studies), indicating the field's growing popularity. However, emerging financial interventions such as facilitating access to digital financial services are relatively understudied. Additionally, 192 studies focus on rural or remote populations, 126 studies investigate interventions to the poor and disadvantaged, and 114 papers specifically address interventions targeted to women. Most of the research is conducted in Sub‐Saharan Africa (175 studies) and South Asia (142 studies), so further research in other regions could be conducted to allow a more holistic understanding of the effects of financial inclusion interventions. Future studies should look into strategy, law, and regulation interventions, as well as interventions targeted at SMEs, and examine policy and regulatory environment outcomes, as well as welfare outcomes. Interventions on the demand side and their impact on the policy and regulatory environment, as well as facilitating access, are relatively understudied.

Date: 2025
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