Empresas de Pequeno Porte e as Condições de Acesso ao Crédito: falhas de mercado, inadequações legais e condicionantes macroeconômicos

Based on two research reports drawn up for the Economic Commission for LatinAmerica and the Caribbean - ECLAC, in 2003-2004, this study evaluates the maindifficulties faced by micro and small enterprises (MSEs) in the banking credit marketin Brazil. Figures relating to bank loan volumes and other information regarding MSE access to credit were obtained directly through interviews with the ten largestbanks operating in the retail and wholesale markets. Barriers restricting MSE access to credit relating to legal diffusion of positive information on credit applicants, slowness of judicial collection procedures to recover non-performed loans, crowding out of private resources by the high public debt, as well as firm management and accounting shortcomings increasing information asymmetry, are discussed. Interpretations forthe large spreads paid by small firms and the high levels of interest rates found in the Brazilian financial market are presented. Research results are synthesized in a diagram, showing the legal, informational and macroeconomic flaws restricting credit and increasing interest rates, and their effects on small enterprise, the banking system and the overall economy. Finally, the main measures that have been implemented in Brazilto improve the functioning of the credit market are discussed and some actions toincrease small enterprise access to credit are suggested.