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Bank Financing for SMES: Evidence Across Countries and Bank-Ownership Types

European Banking Center Discussion Paper No. 2009-20

CentER Discussion Paper Series No. 2009-71

30 Pages Posted: 11 Sep 2009  

Thorsten Beck

City University London - Sir John Cass Business School; Tilburg University - European Banking Center, CentER

Asli Demirgüç-Kunt

World Bank - Development Research Group; World Bank

Maria Soledad Martinez Peria

International Monetary Fund (IMF)

Date Written: September 1, 2009

Abstract

Using data for 91 large banks from 45 countries, this paper finds few differences in the extent, type, and pricing of SME loans across foreign, private, and government-owned banks, even though different bank ownership types apply different lending technologies and have different organizational structures. Instead, we find significant differences across banks in developed and developing countries, driven by differences in the economic, institutional, and legal environment, as opposed to by differences in lending technologies and organizational structures. Finally, the link between lending technologies, organizational structures, and SME financing is not consistent with the conventional view that SME lending is based on “relationship lending”.

Keywords: small and medium enterprises, bank ownership, lending technology, access to finance

JEL Classification: F23, G21, O16

Suggested Citation

Beck, Thorsten and Demirgüç-Kunt, Asli and Martinez Peria, Maria Soledad, Bank Financing for SMES: Evidence Across Countries and Bank-Ownership Types (September 1, 2009). European Banking Center Discussion Paper No. 2009-20. Available at SSRN: https://ssrn.com/abstract=1471331 or http://dx.doi.org/10.2139/ssrn.1471331

Thorsten Beck (Contact Author)

City University London - Sir John Cass Business School ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

Tilburg University - European Banking Center, CentER ( email )

PO Box 90153
Tilburg, 5000 LE
Netherlands

Asli Demirgüç-Kunt

World Bank - Development Research Group ( email )

United States
202-473-7479 (Phone)
202-522-1155 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/ademirguckunt/

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Maria Soledad Martinez Peria

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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