Accessing Alternative Finance in Europe: The Role of SMEs, Innovation, and Digital Platforms

Javier Manso Laso (), Ismael Moya-Clemente and Gabriela Ribes Giner
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Javier Manso Laso: Faculty of Business Administration and Management, Universitat Politècnica de València, 46022 Valencia, Spain
Ismael Moya-Clemente: Faculty of Business Administration and Management, Universitat Politècnica de València, 46022 Valencia, Spain
Gabriela Ribes Giner: Faculty of Business Administration and Management, Universitat Politècnica de València, 46022 Valencia, Spain

JRFM, 2025, vol. 18, issue 9, 1-26

Abstract: Access to business financing in Europe has historically been a challenge for small and medium-sized enterprises (SMEs), which represent a significant share of economic activity and employment in Europe. This issue has been significantly intensified since the global financial crisis, disproportionately affecting this segment. This study analyzes firm-level determinants influencing access to alternative financing sources, including crowdfunding, venture capital, and other non-bank channels, using data from the 2023 SAFE covering 15,855 firms across Europe. Results indicate that firm size significantly affects access, with larger, established firms more likely to secure such funding. However, younger, innovation-driven firms demonstrate a higher propensity to pursue equity and crowdfunding options, driven by their need for flexible and early-stage capital. Sectoral patterns also emerge: industrial firms more often obtain public grants, while service-sector firms lead in adopting equity-based and crowdfunding models. The findings highlight the critical role of innovation capacity and international orientation in broadening financial access. Digital platforms are identified as key enablers in democratizing funding, particularly for SMEs. This research advances understanding of SME financing dynamics within evolving financial landscapes and provides actionable insights for policymakers and practitioners aiming to promote inclusive and sustainable access to finance.

Keywords: alternative financing; firm characteristics; SAFE; SMEs; corporate finance; crowdfunding; venture capital; innovation (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2025
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