<abstract xmlns="http://www.w3.org/1999/xhtml"><p> Access to bank finance is necessary to create an economic environment that enables Small and Medium-sized enterprises (SMEs) to grow and prosper. The SMEs in Sri Lanka, however, face significant constraints to access bank finance. The purpose of this paper is to investigate the access to bank finance and related issues in the SME sector of Sri Lanka. The paper is exploratory in nature and reviews the bank financing situation for SMEs in Sri Lanka, as well as provides an overview of constraints faced by the banks (supply-side) and SMEs (demand-side). The paper also highlights some good practices in SME lending from international experience and outlines some recommendations to help overcome the constraints faced by the banks and SMEs. The recommendations discussed in this paper may be of importance to policymakers, not only in Sri Lanka, but in many other developing countries in a similar stage of economic growth.</p></abstract>

Access to bank finance is necessary to create an economic environment that enables Small and Medium-sized enterprises (SMEs) to grow and prosper. The SMEs in Sri Lanka, however, face significant constraints to access bank finance. The purpose of this paper is to investigate the access to bank finance and related issues in the SME sector of Sri Lanka. The paper is exploratory in nature and reviews the bank financing situation for SMEs in Sri Lanka, as well as provides an overview of constraints faced by the banks (supply-side) and SMEs (demand-side). The paper also highlights some good practices in SME lending from international experience and outlines some recommendations to help overcome the constraints faced by the banks and SMEs. The recommendations discussed in this paper may be of importance to policymakers, not only in Sri Lanka, but in many other developing countries in a similar stage of economic growth.

Bank Finance For Small And Medium-Sized Enterprises In Sri Lanka: Issues And Policy Reforms

College of Business, Victoria University, Melbourne, Australia.

Studies in Business and Economics

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Access to bank finance is necessary to create an economic environment that enables Small and Medium-sized enterprises (SMEs) to grow and prosper. The SMEs in...

Bank Finance For Small And Medium-Sized Enterprises In Sri Lanka: Issues And Policy Reforms

Published Online: Sep 25, 2015

Page range: 32 - 43

DOI: https://doi.org/10.1515/sbe-2015-0018

Keywords
small and medium-sized enterprises, bank lending, financial constraints, Sri Lanka

© 2015

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Bank Finance For Small And Medium-Sized Enterprises In Sri Lanka: Issues And Policy Reforms

Published Online: Sep 25, 2015

Page range: 32 - 43

DOI: https://doi.org/10.1515/sbe-2015-0018

Keywordssmall and medium-sized enterprises, bank lending, financial constraints, Sri Lanka

© 2015

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
small and medium-sized enterprises, bank lending, financial constraints, Sri Lanka