Capital Markets and SMEs in Emerging Markets and Developing Economies
Small and medium enterprises (SMEs) face significant financing gaps that stifle innovation and economic growth. The credit gap alone is estimated at dollar 4.5 trillion as of 2017 for emerging markets and developing economies (EMDEs) only. Bank financing has been the traditional source of external financing to SMEs; however, since the global financial crisis that started in 2007, there has been an active debate about the role that capital markets can play in SME financing. This report seeks to enhance practitioners’ understanding of the potential role that capital markets can have in SME financing in EMDEs. the report reviews global experiences in the use of capital markets solutions and, more generally, in market-based solutions to expand SME financing with a view to identifying key preconditions and challenges for EMDEs implementing the solutions. The report looks at both indirect and direct mechanisms for SME financing, such as capital markets solutions, lending conditions, instruments such as SME loan securitization and others, as well as both debt and equity financing solutions.
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| Format: | Report biblioteca |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | EMERGING MARKET ECONOMIES, CAPITAL MARKETS, SME FINANCE, SMALL AND MEDIUM ENTERPRISES, |
| Online Access: | http://documents.worldbank.org/curated/en/270221582271669731/Capital-Markets-and-SMEs-in-Emerging-Markets-and-Developing-Economies-Can-They-Go-the-Distance https://hdl.handle.net/10986/33373 |
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| Summary: | Small and medium enterprises (SMEs) face
significant financing gaps that stifle innovation and
economic growth. The credit gap alone is estimated at dollar
4.5 trillion as of 2017 for emerging markets and developing
economies (EMDEs) only. Bank financing has been the
traditional source of external financing to SMEs; however,
since the global financial crisis that started in 2007,
there has been an active debate about the role that capital
markets can play in SME financing. This report seeks to
enhance practitioners’ understanding of the potential role
that capital markets can have in SME financing in EMDEs. the
report reviews global experiences in the use of capital
markets solutions and, more generally, in market-based
solutions to expand SME financing with a view to identifying
key preconditions and challenges for EMDEs implementing the
solutions. The report looks at both indirect and direct
mechanisms for SME financing, such as capital markets
solutions, lending conditions, instruments such as SME loan
securitization and others, as well as both debt and equity
financing solutions. |
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