The effect of firm characteristics in accessing credit for SMEs

Yildirim, H. Semih; Akçi, Yavuz; Ekşi̇, İbrahim Halil

doi:10.1057/fsm.2012.28

Cited by 21 publications

(14 citation statements)

References 33 publications

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“…Similarly, banks may grant loans to untrustworthy firms and incur important subsequent costs, due to their use of incomplete or irrelevant information to assessing and monitoring borrowers (Uchida 2011). Several authors argue therefore that banks need two types of information to assess loans: hard and soft (Berger and Frame 2007;Uchida 2011;Yildirim, Akci, and Halil Eksi 2013). Hard information is related to the firm's past financial performance and ability to pay debts and is easily accessible and verifiable from the SME financial statements and credit history.…”

Section: Relationship Between Collaborations and External Financingmentioning

confidence: 99%

External Financing, Export Intensity and Inter-Organizational Collaborations: Evidence from Canadian SMEs*

St‐Pierre

Sakka

Bahri³

2018

Journal of Small Business Management

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Drawing on institutional theory, resource‐based perspective and internationalization theory, we propose that the domestic collaborations of small and medium‐sized enterprises (SMEs) have a direct positive effect on their export intensity, as well as an indirect effect through enhancing these firms' access to external financing. We test our hypotheses on a sample of 151 Canadian manufacturing SMEs and find partial support for the indirect relationship. Overall, our results suggest that domestic collaborations positively affect SMEs' access to equity financing but not to bank financing. While both equity and bank financing are found to enhance these firms' export intensity, bank financing seems to have a greater impact. The implications of these results are discussed.

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Section: Relationship Between Collaborations and External Financingmentioning

confidence: 99%

External Financing, Export Intensity and Inter-Organizational Collaborations: Evidence from Canadian SMEs*

St‐Pierre

Sakka

Bahri³

2018

Journal of Small Business Management

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“…Both banks and borrower firms have to share knowledge at a certain level. For traditional finance, hard information is essential, such as documents that can be checked by any external player; instead, in relationship banking, credit is usually provided on the basis of a relationship of mutual trust founded on deep knowledge generated by the fact that bank and firm have been working together for a long period (De la Torre et al, 2010;Hernández-Cánovas and Koëter-Kant, 2008;Baas and Schrooten, 2006;Jie, 2006;Uchida, 2011;Song and Wang, 2013;Alessandrini et al, 2009;Smit and Fatoki, 2012;Howorth, and Moro, 2012;Yildirim et al, 2013;Thi Bich Ngoc, 2013;Boot, 2000).…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Knowledge sharing and exchange of information within bank and firm networks: the role of the intangibles on the access to credit

Peruta

Campanella

Giudice

2014

Journal of Knowledge Management

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Purpose – The purpose of this paper is to theoretically develop the idea that the intangible value of the collaboration between firms and the banking system can influence the probability of default (PD) on the part of firms and, therefore, their rating. The authors also propose that collaboration between banks and firms has a positive effect not only on the access to credit but also on the innovation activities and on the intervention of foreign capital in the ownership of Italian businesses. Design/methodology/approach – As pointed out by the literature on smaller businesses finance, investments widely rely on credit availability. Tests using data on a sample investigation involving 5,587 firms, operating in 17 manufacturing sectors in Italy, support the majority of the proposed ideas. Findings – The empirical investigation shows that only some aspects of the collaboration between enterprises and banks influence the PD, the investments in R&D and the internationalisation of ownership of the enterprises. In particular, the three stated variables are positively influenced both by the intensity of the credit relationship and by the level of information exchange with the credit system. Research limitations/implications – Further development of this research, as more empirical data become available, should allow explaining why the level of information exchange with the credit system has the greatest influence on the dependent variables analyzed. Originality/value – This paper aims to extend the current understanding on how the local banking system is developed and is able to increase access to credit after gathering all the information about firms asking for funds.

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“…pose challenges to small businesses in their transition to a circular economy, namely lack of financial resources and lack of technical skills (Rizos et all, 2016). Yildirim, Akci, and Eksi (2013) and Mardika, Damayanti, and Supramono (2018) have examined the firm-specific characteristics that affect the access to credit from banks for SMEs. They find that SMEs with a larger asset base can have more access to formal credit than SMEs with a small asset base, as a larger asset base can signal the bank that the SME will be able to pay the extended loans by liquidating the assets (compare Cwynar et al, 2016).…”

Section: Introductionmentioning

confidence: 99%

Evaluation of important credit risk factors in the SME segment

Dvorský

Schönfeld

Kotásková

et al. 2018

Journal of International Studies

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The aim of the paper is to define important credit risk factors in the SME segment, find out how entrepreneurs evaluate these factors, and quantify the differences in their evaluation based on the enterprise's age, gender and attained education level. An empirical research was conducted in relation to the defined aim. 1,141 responses were received by means of the online questionnaire. To process the results, the two-sample t-test was used. Statistical tools such as histogram, Q-Q graph, z-test, and goodness-of-fit tests were applied to verify the assumptions. The results indicate that small and medium-sized enterprises perceive credit risk more intensively in comparison with the pre-crisis era. It was also discovered that the SMEs' knowledge of credit criteria is somewhat low. Entrepreneurs also state that banks' credit criteria are not very transparent. Based on the findings, the length of operating a business has a significant influence on the evaluation of credit risk factors. Experienced entrepreneurs, meaning those operating a business for over 10 years, have a more intense perception of the significance of credit risk, they also have better knowledge of banks' credit criteria, and view credit criteria as more transparent than beginner entrepreneurs.

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The effect of firm characteristics in accessing credit for SMEs

Cited by 21 publications

References 33 publications

External Financing, Export Intensity and Inter-Organizational Collaborations: Evidence from Canadian SMEs*

External Financing, Export Intensity and Inter-Organizational Collaborations: Evidence from Canadian SMEs*

Knowledge sharing and exchange of information within bank and firm networks: the role of the intangibles on the access to credit

Evaluation of important credit risk factors in the SME segment

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