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A Guide to SME FinancingHow May Banks Address the Constraints and Perceived Drawbacks to Financing SMEs?

A Guide to SME Financing: How May Banks Address the Constraints and Perceived Drawbacks to... [SMEs often lack adequate financial records, have insufficient collateral, and non-professional management (they are often family enterprises). Unless a cost-conscious lending methodology is adopted, transaction costs can exceed earnings on the small loans many SMEs require. Mitigation strategies for these risks are discussed at length, including instructions on how to assemble financial statements using account turnover information and industry averages. These approaches are part of the template-driven methodology advocated in the Guide. Elements of the semi-automated approach are described in detail within the context of a risk-mitigation strategy.] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

A Guide to SME FinancingHow May Banks Address the Constraints and Perceived Drawbacks to Financing SMEs?

Munro, David
Springer Journals — Nov 5, 2015
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13 pages

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Publisher
Palgrave Macmillan US
Copyright
© Palgrave Macmillan, a division of Nature America Inc. 2013
ISBN
978-1-349-47742-5
Pages
18 –31
DOI
10.1057/9781137373786_4
Publisher site
See Chapter on Publisher Site

Abstract

[SMEs often lack adequate financial records, have insufficient collateral, and non-professional management (they are often family enterprises). Unless a cost-conscious lending methodology is adopted, transaction costs can exceed earnings on the small loans many SMEs require. Mitigation strategies for these risks are discussed at length, including instructions on how to assemble financial statements using account turnover information and industry averages. These approaches are part of the template-driven methodology advocated in the Guide. Elements of the semi-automated approach are described in detail within the context of a risk-mitigation strategy.]

Published: Nov 5, 2015

Keywords: Balance Sheet; Operating Expense; Income Statement; Credit Score; Loan Application

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