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The Impact of Macroeconomic Policy on the Liquidity and Financial Stability of SMEs through the Prism of Banking Activities

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  • Volodymyr Antoniuk

    (Yuriy Fedkovych Chernivtsi National University, Chernivtsi, Ukraine)

  • Maksym Marych

    (Yuriy Fedkovych Chernivtsi National University, Chernivtsi, Ukraine)

Abstract

Unlike large companies, small and medium-sized enterprises (SMEs) are more sensitive to the influence of external factors, such as changes in market conditions, competition, and economic crises. Therefore, the development of such enterprises depends significantly on the state's macroeconomic policy and the availability of financing sources. The article aims to determine the impact of macroeconomic policy on the liquidity and financial stability of small and medium-sized enterprises through the prism of banking activities. The study uses a systematic approach to assess the relationship between macroeconomic factors and banking activities. In particular, statistical analysis was used to evaluate the dynamics of the main indicators of the financial stability of SMEs, and econometric modelling was used to determine the relationships between macroeconomic variables and the availability of credit resources. The article identifies the main macroeconomic factors that shape the availability of financing for SMEs, in particular: monetary policy (changes in the discount rate, inflation rate, banking regulation), fiscal policy (tax burden, government support programs), and the instability of the financial environment. The study results show that tight monetary policy, in particular an increase in the discount rate, significantly limits SMEs' access to credit resources, increasing the cost of borrowed capital and reducing the investment activity of enterprises. At the same time, fiscal policy, particularly the tax burden and state support programs, can compensate for monetary regulation's negative impact or create additional financial barriers for businesses. Countries with developed small business financing mechanisms, including tax incentives and flexible credit programs, demonstrate a higher level of SMEs' resilience to economic shocks. In addition, the level of financial literacy of entrepreneurs and their ability to adapt to changes in the economic environment remains an important factor. The results of the study provide recommendations for improving macroeconomic policy to ensure SMEs' financial stability.

Suggested Citation

  • Volodymyr Antoniuk & Maksym Marych, 2025. "The Impact of Macroeconomic Policy on the Liquidity and Financial Stability of SMEs through the Prism of Banking Activities," Oblik i finansi, Institute of Accounting and Finance, issue 2, pages 32-39, June.
    • Handle: RePEc:iaf:journl:y:2025:i:2:p:32-39
    DOI: 10.33146/2307-9878-2025-2(108)-32-39
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    References listed on IDEAS

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    1. Casey, Eddie & O'Toole, Conor M., 2014. "Bank lending constraints, trade credit and alternative financing during the financial crisis: Evidence from European SMEs," Journal of Corporate Finance, Elsevier, vol. 27(C), pages 173-193.
    2. Meghana Ayyagari & Asli Demirgüç-Kunt & Vojislav Maksimovic, 2008. "How Important Are Financing Constraints? The Role of Finance in the Business Environment," The World Bank Economic Review, World Bank, vol. 22(3), pages 483-516, November.
    3. O'Toole, Conor & Casey, Eddie, 2014. "Bank-lending Constraints, Trade Credit and Alternative External Finance since the Financial Crisis: Evidence from European SMEs," Papers RB2014/2/3, Economic and Social Research Institute (ESRI).
    4. Thorsten Beck & Asli Demirgüç‐Kunt & Vojislav Maksimovic, 2005. "Financial and Legal Constraints to Growth: Does Firm Size Matter?," Journal of Finance, American Finance Association, vol. 60(1), pages 137-177, February.
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    Keywords

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    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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