Small and medium-sized enterprises (SMEs) are an essential part of any economy by contributing to wealth creation and poverty alleviation. In most countries, SMEs employ the largest share of the workforce and contribute significantly to the country’s GDP. As such, job and value creation in the SME arena is a vehicle for inclusive growth. SMEs also have the potential to bring about substantial environmental improvements and are an engine for technological progress and innovation. Usually, SMEs are financially sound and have a successful history as long-standing microenterprises.
Nevertheless, in many countries SMEs have limited access to financial products and services. Misguided perceptions of overly risky business models that serve unprofitable customers mean that SMEs are not served by many commercial banks. Success stories worldwide, however, illustrate that SME finance can be a profitable business and that the risks can be managed. Banks can profit by engaging with SMEs, diversifying their credit risk and customer structure, and thus expanding their business.
We help financial institutions to establish or improve SME finance as a sustainable business segment.
