Financing SMEs and entrepreneurs 2012 : an OECD scoreboard

Abstract

Small and medium-sized enterprises (SMEs) are important engines of growth, jobs and social cohesion. However, the creation, survival and growth of SMEs are often hampered by access to finance, a challenge that is at the core of this scoreboard on financing SMEs and entrepreneurs. The global crisis has exacerbated the financing constraints on SMEs. They have suffered a double shock: a drastic drop in the demand for the goods and services they provide and a credit crunch. These events have had a severe effect on SMEs' cash flows and liquidity, forcing many into bankruptcy and contributing to record levels of unemployment in much Organization for Economic Co-operation and Development (OECD) countries. Since the onset of the crisis, governments have responded with a number of different measures to support sales, prevent the depletion of SMEs' working capital and enhance access to credit for SMEs. The importance of SME finance is now widely recognized. At the Pittsburgh Summit in 2009, G20 leaders acknowledged that access to finance provides growth opportunities for businesses and the economy as a whole. Financial Inclusion is a pillar of the G20 multi-year action plan on development, and the G20 Global Platform for Financial Inclusion (GPFI) was launched in Korea in December 2010. The need to address the financing hurdles to SME growth was also underlined by G8 Leaders at the 2011 Deauville Summit, where the OECD was invited, in co-operation with other relevant international institutions, to identify impediments to SME growth, including the issue of private funding.

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