Post-COVID-19 SME Financing Constraints and the Credit Guarantee Scheme Solution in Spain
Journal of Banking Regulation, 2021
1 Pages Posted: 20 Nov 2020 Last revised: 8 Jul 2021
Date Written: February 16, 2021
Countries around the world are working hard to fight against the economic crisis caused by the coronavirus pandemic, with a special emphasis on small- and medium-sized enterprises (SMEs) due to their vulnerability and importance in the business ecosystem. This paper analyzes the Spanish guarantee model and the measures taken by regional governments in conjunction with the main mutual guarantee societies (MGSs) to mitigate the economic problems associated with the COVID-19 pandemic. We show that public administrations may use guarantee schemes as instruments to improve SME access to financing while limiting the burden on the public budget.
Keywords: COVID-19, Small- and medium-sized enterprises, Credit risk, Mutual guarantee societies, Bank financing
JEL Classification: G21, G23, G28
Suggested Citation: Suggested Citation