The European Small Business Finance Outlook provides an overview on the main markets relevant to the European Investment Fund – EIF (INSME Member) such as equity, guarantees, securitisation and microfinance. On a more general note, the outlook points out that one in four SMEs still report severe difficulties in accessing finance. This highlights important structural credit market failures preventing market supply from satisfying SMEs’ financing demands. In addition, insufficient public support for external financing markets continues to be a concern for EU SMEs.
Among the findings, the outlook highlights that:
- SME guarantees: credit guarantees remain the most used instrument across countries to ease SMEs access to finance and statistics show that Turkey, Italy and France are the top 3 countries in terms of both volume and number of outstanding SMEs guarantees;
- Microfinance and inclusive finance: microenterprises and social enterprises are important contributors to employment and social value, especially in countries with high unemployment rates; the report also stresses that access to finance is crucial not only for microenterprises but also for those willing to start a business and escape poverty or unemployment. In addition to financial support, unemployed people are also in need of coaching and mentoring to gain the necessary skills for success;
- Fintech: the global fintech market continued to grow at an exponential rate during 2018. The crowdfunding market shows first signs of maturity since total business transaction volume sourced on crowdfunding platform grew by 47% between 2016 and 2017, which is half of the growth rate of one year earlier;
- SME Leasing: leasing is an additional instrument to facilitate access to financing for SMEs, even though it is mainly used just in property, plant or equipment. Finland, Germany and Austria are the countries with the highest proportion of SMEs using leasing.
More insights here.