The financing of small and medium-sized enterprises: An analysis of the financing gap in Brazil

Joseph Mc Cahery; Marcelo Godke Veiga

doi:10.1007/s40804-019-00167-7

The financing of small and medium-sized enterprises: An analysis of the financing gap in Brazil

Tilburg Law and Economic Center (TILEC)

Research output: Contribution to journal › Article › Scientific › peer-review

Abstract

While small and medium-sized enterprises (SMEs) are important for economic growth and employment, they face numerous obstacles in accessing external finance. In this article, we review recent developments in the availability of financing for SMEs in Brazil, focusing on the greater use of equity and debt for SMEs. In assessing the barriers to external financing, we focus on the role of bank characteristics, market structure and variations of interest rate spreads across banks and time. Moreover, as banks retreat from SME financing, we examine the potential for SMEs to seek new sources of financing from private equity and venture capital funds. We examine the changes in the availability of bank loans between 2014 and 2016. By considering demand, we estimate the SME loan gap based on Central Bank and publicly available data. Our results show that the loan gap in Brazil is substantial.

Original language	English
Pages (from-to)	633-664
Number of pages	32
Journal	European Business Organization Law Review
Volume	20
Issue number	4
DOIs	https://doi.org/10.1007/s40804-019-00167-7
Publication status	Published - Dec 2019

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 8 Decent Work and Economic Growth
SDG 9 Industry, Innovation, and Infrastructure

Keywords

Bank loans, Entrepreneurial financing, Interest rate SME funding

Access to Document

10.1007/s40804-019-00167-7

https://link.springer.com/article/10.1007/s40804-019-00167-7

Connecting Organizations
Bekker, S. (Researcher), Bomer, A. (Researcher), Borghouts, I. (Researcher), De Pietro, C. (Researcher), Dusarduijn, S. (Researcher), Elsweier, F. (Researcher), Essers, P. (Researcher), Garcia Anton, R. (Researcher), Gribnau, H. (Researcher), Gubbels, N. (Researcher), Hoogeveen, M. (Researcher), Houwerzijl, M. (Researcher), Kaufmann, W. (Researcher), Kemmeren, E. (Researcher), Lafarre, A. (Principal Investigator), Lejour, A. (Researcher), Li, J. (Researcher), Loth, M. (Researcher), Mc Cahery, J. (Researcher), Montebovi, S. (Researcher), Peters, C. (Researcher), Rombouts, B. (Researcher), Russo, R. (Researcher), Staats, G. (Researcher), Starink, B. (Researcher), Steegmans, M. (Researcher), Stevens, S. (Researcher), Stevens, T. (Researcher), Sumner, I. (Researcher), Tjong Tjin Tai, E. (Researcher), Tzankova, I. (Researcher), Verbruggen, P. (Researcher), Vermeulen, E. (Researcher), Westerhout, E. (Researcher), Weterings, W. (Researcher), Wibier, R. (Researcher), Xu, D. (Researcher), Zegveld, C. (Researcher), Zekić, N. (Researcher), van Gulijk, S. (Researcher), van Hout, D. (Researcher), van Hulten, M. (Researcher), van Kempen, T. (Researcher), van Kesteren, H. (Researcher), van Vijfeijken, I. (Researcher), Van der Elst, C. (Researcher), Van der Sangen, G. (Researcher), Öner, C. (Researcher), Kryla-Cudna, K. (Researcher), Mak, V. (Researcher), Smit, D. (Researcher), Op Heij, D. (Researcher), Onţanu, E. A. (Researcher), Salah, O. (Researcher), Wijntjens, L. (Researcher), van Norden, G.-J. (Researcher), Vereijken-van den Bosch, S. (Researcher), Fernandez de Aranguiz Chueca, A. (Researcher), Diamant, Y. (Researcher), Geiregat, S. (Researcher), van der Burgt, B. (Researcher), Hofman, A. (Researcher) & Groeneveld-Tijssens, N. (Researcher)
1/01/19 → 31/12/23
Project: Research project

Cite this

@article{a40ee14c63994df8b67c21e53441aa31,

title = "The financing of small and medium-sized enterprises: An analysis of the financing gap in Brazil",

abstract = "While small and medium-sized enterprises (SMEs) are important for economic growth and employment, they face numerous obstacles in accessing external finance. In this article, we review recent developments in the availability of financing for SMEs in Brazil, focusing on the greater use of equity and debt for SMEs. In assessing the barriers to external financing, we focus on the role of bank characteristics, market structure and variations of interest rate spreads across banks and time. Moreover, as banks retreat from SME financing, we examine the potential for SMEs to seek new sources of financing from private equity and venture capital funds. We examine the changes in the availability of bank loans between 2014 and 2016. By considering demand, we estimate the SME loan gap based on Central Bank and publicly available data. Our results show that the loan gap in Brazil is substantial. ",

keywords = "Bank loans, Entrepreneurial financing, Interest rate SME funding",

author = "\{Mc Cahery\}, Joseph and \{Godke Veiga\}, Marcelo",

year = "2019",

month = dec,

doi = "10.1007/s40804-019-00167-7",

language = "English",

volume = "20",

pages = "633--664",

journal = "European Business Organization Law Review",

issn = "1566-7529",

publisher = "Springer International Publishing AG",

number = "4",

}

TY - JOUR

T1 - The financing of small and medium-sized enterprises

T2 - An analysis of the financing gap in Brazil

AU - Mc Cahery, Joseph

AU - Godke Veiga, Marcelo

PY - 2019/12

Y1 - 2019/12

N2 - While small and medium-sized enterprises (SMEs) are important for economic growth and employment, they face numerous obstacles in accessing external finance. In this article, we review recent developments in the availability of financing for SMEs in Brazil, focusing on the greater use of equity and debt for SMEs. In assessing the barriers to external financing, we focus on the role of bank characteristics, market structure and variations of interest rate spreads across banks and time. Moreover, as banks retreat from SME financing, we examine the potential for SMEs to seek new sources of financing from private equity and venture capital funds. We examine the changes in the availability of bank loans between 2014 and 2016. By considering demand, we estimate the SME loan gap based on Central Bank and publicly available data. Our results show that the loan gap in Brazil is substantial.

AB - While small and medium-sized enterprises (SMEs) are important for economic growth and employment, they face numerous obstacles in accessing external finance. In this article, we review recent developments in the availability of financing for SMEs in Brazil, focusing on the greater use of equity and debt for SMEs. In assessing the barriers to external financing, we focus on the role of bank characteristics, market structure and variations of interest rate spreads across banks and time. Moreover, as banks retreat from SME financing, we examine the potential for SMEs to seek new sources of financing from private equity and venture capital funds. We examine the changes in the availability of bank loans between 2014 and 2016. By considering demand, we estimate the SME loan gap based on Central Bank and publicly available data. Our results show that the loan gap in Brazil is substantial.

KW - Bank loans, Entrepreneurial financing, Interest rate SME funding

U2 - 10.1007/s40804-019-00167-7

DO - 10.1007/s40804-019-00167-7

M3 - Article

SN - 1566-7529

VL - 20

SP - 633

EP - 664

JO - European Business Organization Law Review

JF - European Business Organization Law Review

IS - 4

ER -

The financing of small and medium-sized enterprises: An analysis of the financing gap in Brazil

Abstract

UN SDGs

Keywords

Access to Document

Fingerprint

Projects

Connecting Organizations

Cite this