IDEAS home Printed from https://ideas.repec.org/p/eps/cepswp/8061.html
   My bibliography  Save this paper

Access by MSMEs to Finance in the Southern and Eastern Mediterranean: What role for credit guarantee schemes?

Author

Listed:
  • Ayadi, Rym
  • Gadi, Salim

Abstract

Micro-, small- and medium-sized enterprises (MSMEs) in the Southern and Eastern Mediterranean suffer from credit constraints. Given their contribution to employment and growth, similarly as in other regions, policy-makers have developed credit guarantee schemes (CGSs) in order to facilitate small companies’ access to debt capital. CGSs are risk-sharing mechanisms under which a guarantor ensures the lender against a share of the possible losses it incurs when extending a loan. Despite the maturity of some schemes, knowledge of the schemes’ functioning, operating environment as well as performance in guaranteeing loans for MSMEs is scarce. Building on a previous study of CGSs in the region, this paper extends the available knowledge on the region’s schemes, building on the results of an exclusive questionnaire to gain insights into these mechanisms. First, the paper reviews the conditions of MSMEs’ access to finance in the Southern and Eastern Mediterranean; second, it presents the results of the questionnaire across a number of dimensions ranging from ownership to financial performance; and third, the paper presents some avenues for future policy research in this area.

Suggested Citation

  • Ayadi, Rym & Gadi, Salim, 2013. "Access by MSMEs to Finance in the Southern and Eastern Mediterranean: What role for credit guarantee schemes?," CEPS Papers 8061, Centre for European Policy Studies.
    • Handle: RePEc:eps:cepswp:8061
    as

    Download full text from publisher

    File URL: http://www.ceps.eu/system/files/MEDPRO%20TP%20No%2035%20RA%20%2526%20SG%20MSME%20Access%20to%20Finance.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Beck, Thorsten & Klapper, Leora F. & Mendoza, Juan Carlos, 2010. "The typology of partial credit guarantee funds around the world," Journal of Financial Stability, Elsevier, vol. 6(1), pages 10-25, April.
    2. AfDB AfDB, . "AfDB Group Annual Report in Brief 2009," Annual Report, African Development Bank, number 65 edited by Koua Louis Kouakou.
    3. Inha Oh & Jeong-Dong Lee & Almas Heshmati & Gyoung-Gyu Choi, 2009. "Evaluation of credit guarantee policy using propensity score matching," Small Business Economics, Springer, vol. 33(3), pages 335-351, October.
    4. Claire Lelarge & David Sraer & David Thesmar, 2010. "Entrepreneurship and Credit Constraints: Evidence from a French Loan Guarantee Program," NBER Chapters, in: International Differences in Entrepreneurship, pages 243-273, National Bureau of Economic Research, Inc.
    5. Honohan, Patrick, 2010. "Partial credit guarantees: Principles and practice," Journal of Financial Stability, Elsevier, vol. 6(1), pages 1-9, April.
    6. Barth,James R. & Caprio,Gerard & Levine,Ross, 2008. "Rethinking Bank Regulation," Cambridge Books, Cambridge University Press, number 9780521709309, October.
    7. AfDB AfDB, . "AfDB Group Annual Report 2009," Annual Report, African Development Bank, number 66 edited by Koua Louis Kouakou.
    8. AfDB AfDB, . "AfDB Group Annual Report 2009 (Arabic)," Annual Report, African Development Bank, number 68 edited by Koua Louis Kouakou.
    9. Stiglitz, Joseph E & Weiss, Andrew, 1981. "Credit Rationing in Markets with Imperfect Information," American Economic Review, American Economic Association, vol. 71(3), pages 393-410, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Paroussos, Leonidas & Fragkiadakis, Kostas & Charalampidis, Ioannis & Tsani, Stella & Capros, Pantelis, 2015. "Macroeconomic scenarios for the south Mediterranean countries: Evidence from general equilibrium model simulation results," Economic Systems, Elsevier, vol. 39(1), pages 121-142.
    2. Ayadi, Rym, 2013. "Financial Sector Development and Integration in the Southern and Eastern Mediterranean: Towards a long-term sustainable transition," CEPS Papers 7936, Centre for European Policy Studies.
    3. Nabamita Dutta, 2019. "The Obstacle Named 'Corruption': An Empirical Analysis of Indian Firms," Review of Economics & Finance, Better Advances Press, Canada, vol. 17, pages 51-64, August.
    4. Emma Galli & Danilo Valerio Mascia & Stefania Patrizia Sonia Rossi, 2018. "Does Corruption Influence the Self-Restraint Attitude of Women-led SMEs towards Bank Lending?," CESifo Economic Studies, CESifo Group, vol. 64(3), pages 426-455.
    5. Ayadi, Rym & De Groen, Willem Pieter, 2014. "Micro-, Small- and Medium-Sized Enterprises with High-Growth Potential in the Southern Mediterranean: Identifying Obstacles and Policy Responses," CEPS Papers 8796, Centre for European Policy Studies.
    6. Mascia, Danilo V., 2018. "Young Enterprises and Bank Credit Denials," ADBI Working Papers 844, Asian Development Bank Institute.
    7. Johnson, Barbara & Kotey, Richard Angelous, 2018. "The Influence of Small and Medium Enterprises (SMEs) Listing on the Ghana Alternative Market (GAX): Prevailing Factors," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 4(4), pages 142-156.
    8. Nazima Ellahi & Adiqa Kausar Kiani & Muhammad Awais & Hina Affandi & Rabia Saghir & Sarah Qaim, 2021. "Investigating the Institutional Determinants of Financial Development: Empirical Evidence From SAARC Countries," SAGE Open, , vol. 11(2), pages 21582440211, April.
    9. Danilo V. Mascia, 2018. "Young Enterprises and Bank Credit Denials," Working Papers id:12814, eSocialSciences.
    10. Emma Galli & Danilo V. Mascia & Stefania P. S. Rossi, 2017. "Small Firms, Corruption, and Demand for Credit. Evidence from the Euro Area," International Business Research, Canadian Center of Science and Education, vol. 10(11), pages 158-174, November.
    11. Bahar Öztürk & Mr. Mico Mrkaic, 2014. "SMEs’ Access to Finance in the Euro Area: What Helps or Hampers?," IMF Working Papers 2014/078, International Monetary Fund.
    12. Harrison, Richard & Li, Youwei & Vigne, Samuel A. & Wu, Yuliang, 2022. "Why do small businesses have difficulty in accessing bank financing?," International Review of Financial Analysis, Elsevier, vol. 84(C).
    13. Brian Micallef, 2016. "The Adjustment of Maltese Firms to the Post-crisis Economic Environment: Evidence from a Firm-level Survey," International Business Research, Canadian Center of Science and Education, vol. 9(9), pages 122-133, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cowling, Marc & Ughetto, Elisa & Lee, Neil, 2018. "The innovation debt penalty: Cost of debt, loan default, and the effects of a public loan guarantee on high-tech firms," Technological Forecasting and Social Change, Elsevier, vol. 127(C), pages 166-176.
    2. Thorsten Beck & Samuel Munzele Maimbo & Issa Faye & Thouraya Triki, 2011. "Financing Africa : Through the Crisis and Beyond," World Bank Publications - Books, The World Bank Group, number 2355.
    3. Peter Hennecke & Doris Neuberger & Dirk Ulbricht, 2019. "The economic and fiscal benefits of guarantee banks in Germany," Small Business Economics, Springer, vol. 53(3), pages 771-794, October.
    4. Lagazio, Corrado & Persico, Luca & Querci, Francesca, 2021. "Public guarantees to SME lending: Do broader eligibility criteria pay off?," Journal of Banking & Finance, Elsevier, vol. 133(C).
    5. Grimsby, Gjermund, 2018. "Partly risky, partly solid – Performance study of public innovation loans," Research Policy, Elsevier, vol. 47(7), pages 1344-1365.
    6. Saadani, Youssef & Arvai, Zsofia & Rocha, Roberto, 2011. "A review of credit guarantee schemes in the Middle East and North Africa Region," Policy Research Working Paper Series 5612, The World Bank.
    7. Thomas Url, 2018. "Die Folgen staatlicher Wechselbürgschaften und Beteiligungsgarantien für Inlandsbeschäftigung und Leistungsbilanz," WIFO Studies, WIFO, number 61057, April.
    8. Bertoni, Fabio & Colombo, Massimo G. & Quas, Anita, 2023. "The long-term effects of loan guarantees on SME performance," Journal of Corporate Finance, Elsevier, vol. 80(C).
    9. Asdrubali, Pierfederico & Signore, Simone, 2015. "The Economic Impact of EU Guarantees on Credit to SMEs – Evidence from CESEE Countries," EIF Working Paper Series 2015/29, European Investment Fund (EIF).
    10. Obeng, K. & Sakano, R., 2012. "Airline fare and seat management strategies with demand dependency," Journal of Air Transport Management, Elsevier, vol. 24(C), pages 42-48.
    11. Fullerton, Thomas M. & Juarez, David A. & Walke, Adam G., 2012. "Residential electricity consumption in Seattle," Energy Economics, Elsevier, vol. 34(5), pages 1693-1699.
    12. Duan, Jin-Chuan & Van Laere, Elisabeth, 2012. "A public good approach to credit ratings – From concept to reality," Journal of Banking & Finance, Elsevier, vol. 36(12), pages 3239-3247.
    13. Meslier, Céline & Tacneng, Ruth & Tarazi, Amine, 2014. "Is bank income diversification beneficial? Evidence from an emerging economy," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 31(C), pages 97-126.
    14. Elisa Ughetto & Andrea Vezzulli, 2011. "What role can mutual guarantee consortia play for financing innovation? A firm-level study for Italy," International Journal of Banking, Accounting and Finance, Inderscience Enterprises Ltd, vol. 3(4), pages 294-319.
    15. Honohan, Patrick, 2010. "Partial credit guarantees: Principles and practice," Journal of Financial Stability, Elsevier, vol. 6(1), pages 1-9, April.
    16. Kraemer-Eis, Helmut & Botsari, Antonia & Gvetadze, Salome & Lang, Frank & Torfs, Wouter, 2019. "European Small Business Finance Outlook: June 2019," EIF Working Paper Series 2019/57, European Investment Fund (EIF).
    17. Kuo, Chung-Wei & Jou, Rong-Chang & Lin, Shu-Wun, 2012. "Turnover intention of air traffic controllers in Taiwan: A note," Journal of Air Transport Management, Elsevier, vol. 25(C), pages 50-52.
    18. Carlos Vidal-Meliá & Mar𨁤el Carmen Boado-Penas, 2013. "Compiling the actuarial balance for pay-as-you-go pension systems. Is it better to use the hidden asset or the contribution asset?," Applied Economics, Taylor & Francis Journals, vol. 45(10), pages 1303-1320, April.
    19. Karel Janda, 2011. "Credit Rationing and Public Support of Commercial Credit," CERGE-EI Working Papers wp436, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    20. Karel Janda, 2011. "Credit Guarantees and Subsidies when Lender has a Market Power," Working Papers IES 2011/18, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Jun 2011.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eps:cepswp:8061. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Margarita Minkova (email available below). General contact details of provider: https://edirc.repec.org/data/cepssbe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.