Introduction: The Actuality and the Potential of SMEs in Developing Economies

David Munro

A chapter in A Guide to SME Financing, 2013, pp 1-6 from Palgrave Macmillan

Abstract: Abstract The introduction makes clear that there is a qualitative difference between micro-finance and SME finance. Not only does the nature of the enterprises themselves differ, but the approaches to financing them differ as well. SME financing is appropriate for banks, micro-finance less so. The Guide deals with SME finance in developing economies, not developed economies. The nature of information resources differs substantially between the two environments as well as the sophistication of the enterprises themselves. SMEs provide a pathway to employment in many developing nations, and account for a large proportion of the work force. SME finance can help a bank create a broad, shallow (welldiversified) loan portfolio. The Guide provides a step-by-step approach to developing an SME financing capability, and is appropriate for banks, non-bank financial institutions, donor agencies, academics, NGOs and consulting firms.

Keywords: Commercial Bank; Donor Agency; Loan Portfolio; Venture Capital Fund; Credit Rating Agency (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-37378-6_1

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DOI: 10.1057/9781137373786_1

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