SME Banking Brochure

In both developed and emerging economies, promoting a dynamic Small and Medium Enterprise (SME) landscape is a priority amongst numerous economic development goals. SMEs contribute greatly to economic diversification and social stability and play an important role in private sector development. Yet in a typical economy, SME development represents a major and difficult challenge. SMEs typically face more severe constraints to growth than large companies, their lack of significant size resulting in reduced access to markets, skills, and capital.

SMEs are also a primary driver for job creation and GDP growth. In many countries, the majority of jobs are provided by SMEs. In 30 high-income countries of the OECD, SMES – registered enterprises with fewer than 250 employees – represent over two-thirds of formal employment. In low-income countries, this figure is also significant.

The SME Banking Opportunity:

-The SME market is becoming increasingly attractive as competition increases for more established corporate clients.
-SMEs provide a new target market and business development opportunities which diversify a bank’s portfolio.
-The SME market is large, with a potential for significant growth, and still largely underserved in most emerging markets.
-SMEs offer an opportunity for portfolio diversification as they are active in various industry sectors and geographic locations.
-An SME portfolio generates a stable income and requires less complex asset-liability management at the portfolio level.
-SMEs are integrated into the rest of the economy, providing cross-selling opportunities.