Impact of market-based finance on SMEs failure

Gupta, Jairaj; Gregoriou, Andros

doi:10.1016/j.econmod.2017.09.004

Cited by 43 publications

(33 citation statements)

References 26 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…However, SMEs are challenged with serious financial limitations when compared to listed firms since they cannot increase funds by issuing stocks and bonds, thus bank borrowing is the core source of funding [53]. Besides, scarce collateral, weak solvency, short/no credit history, immature bank-borrower dealings, high transaction costs and information asymmetry were noticed as the main difficulties with reference to gathering commercial bank financing, particularly long-term borrowings [43]. Wang [54] exhibited the most significant impediments observed by SMEs managers, namely "access to finance", "tax rate", "competition", "electricity" and "political factors".…”

Section: Prior Research On Smes Financingmentioning

confidence: 99%

Small and Medium-Sized Enterprises (SMEs): The Engine of Economic Growth through Investments and Innovation

et al. 2020

View full text Add to dashboard Cite

Small and medium-sized enterprises (SMEs) are crucial for local economic development, playing a noteworthy role in job creation, poverty alleviation and economic growth, but they encounter many funding barriers. The purpose of the current paper is to investigate the impact of investments and innovation on territorial economic growth, as measured by turnover, for Romanian active enterprises, especially SMEs, over the period 2009–2017. By estimating several log–log linear regressions, the quantitative outcomes provide support for a positive influence of investments on turnover. The association was confirmed both for all active enterprises at the national level, as well as for micro, small, middle-sized and big companies. As regards expenditures on innovation, a positive impact on turnover was acknowledged for all enterprises and particularly for big companies, but there was an absence of any statistically significant relation in the case of SMEs. The impact of firm size on turnover was positive for all active enterprises at the national level, along with active micro-units. Also, the estimation results show a positive impact of the number of active micro-units on territorial economic growth. The empirical findings are relevant to managers and policymakers in order to stimulate, encourage and offer support to SMEs’ development through their strategies.

show abstract

Section: Prior Research On Smes Financingmentioning

confidence: 99%

Small and Medium-Sized Enterprises (SMEs): The Engine of Economic Growth through Investments and Innovation

et al. 2020

View full text Add to dashboard Cite

show abstract

“…Despite having a substantial contribution of SMEs (results of entrepreneurship) to GDP, economic growth and sustainable development goals, there is a high failure ratio of ventures across the globe [5]. Studies, in this perspective, have been discussed a variety of determinants which may affect success for example, [6,7] and failure of SMEs [8,9]. Due to the lack of resources and capabilities, SMEs need not only financial support but also equally required non-financial support to survive in the turbulent markets.…”

Section: Introductionmentioning

confidence: 99%

The Role of Government Support in Sustainable Competitive Position and Firm Performance

et al. 2018

View full text Add to dashboard Cite

Achievement of sustainable competitive position and superior performance is the first priority of business organizations. However, small firms, due to fairly known reasons; lack of resources, financial capabilities and lack of managerial skills are often unable to succeed in their mission. Hence, they often look for less risky and convenience sources to compete in the market. A variety of factors has been tested towards a firm competitive position and performance but the role of government support in this perspective has received minor attention. The present study examines the influence of government financial support and nonfinancial support on firm performance with mediating role of the sustainable competitive position. Hypotheses were tested using structural equation modeling in Analysis Moment of Structure (AMOS) on a data set of 326 Pakistani Small and Medium Size Enterprises (SMEs). The results indicate that government financial and nonfinancial support have a significant influence on sustainable competitive position and firm performance. Additionally, a sustainable competitive position partially mediates the relationship between government support and firm performance. Government bodies and policy makers are advised to provide financial and nonfinancial support to SMEs which in turn can upsurge economic growth and sustainability.

show abstract

“…Both formal financial institutions and informal ones are important channels for SMEs to raise funds. However, compared with large enterprises, SMEs face greater difficulties in accessing external financing due to the many inherent features of SMEs, such as an information asymmetry [16], a lack of trading history [17], a high risk of failure [29], and a low portion of tangible assets in their total assets [30]. Many studies find that it is more difficult for SMEs to access external financing than larger enterprises, both in developing countries and developed countries [31,32].…”

Section: Smes and Their Financial Constraintsmentioning

confidence: 99%

Alleviating Financing Constraints of SMEs through Supply Chain

Yang

Chen

et al. 2019

Sustainability

View full text Add to dashboard Cite

Small and medium-sized enterprises play a crucial role in sustaining economic development in both developed economies and developing economies, however, many of them suffer from chronic and structural difficulties in accessing external financing. In this paper, we develop a theoretical framework to illustrate how information structures work in the strategic interactions between banks and firms in a supply chain, and why the transaction information in a supply chain may serve to reduce information asymmetry and improve SMEs’ access to external financing. We find that under incomplete information, the transactions between SMEs and suppliers can serve as signals for banks, which may help banks access the private information of SMEs, thus reducing information asymmetry between them. To maximize profit, banks should dynamically adjust both their interest rate policies and risk management strategies when providing financing services to SMEs, according to the structure of the financial market. The improvement of the external financial environment for SMEs may benefit the entire supply chain, thus facilitating its sustainable development and the growth of SMEs. Our framework sheds light on how SMEs in a supply chain may enhance their survivability and facilitate their development through appropriate strategies to improve business performances and manage credit risks.

show abstract

Impact of market-based finance on SMEs failure

Cited by 43 publications

References 26 publications

Small and Medium-Sized Enterprises (SMEs): The Engine of Economic Growth through Investments and Innovation

Small and Medium-Sized Enterprises (SMEs): The Engine of Economic Growth through Investments and Innovation

The Role of Government Support in Sustainable Competitive Position and Firm Performance

Alleviating Financing Constraints of SMEs through Supply Chain

Contact Info

Product

Resources

About