Access to finance represents one of the most significant challenges for entrepreneurs and for the creation, survival and growth of small businesses. As governments address this challenge, they are running up against a major and longstanding obstacle to policy making: insufficient evidence and data. Better data is needed to understand the financing needs of SMEs and entrepreneurs and to provide the basis for informed institutional and public policy decisions.
This first edition of "Financing SMEs and Entrepreneurs: An OECD Scoreboard" represents a major step in addressing this obstacle by establishing a comprehensive international framework for monitoring SMEs’ and entrepreneurs’ access to finance over time. Comprising 18 countries, including Canada, Chile, Denmark, Finland, France, Hungary, Italy, Korea, the Netherlands, New Zealand, Portugal, Slovak Republic, Slovenia, Sweden, Switzerland, Thailand, the United Kingdom and the United States, the Scoreboard presents data for a number of debt, equity and financing framework condition indicators. Taken together, they provide governments and other stakeholders with a tool to understand SMEs’ financing needs, to support the design and evaluation of policy measures and to monitor the implications of financial reforms on SMEs’ access to finance.
- Publication Date :
- 19 Apr 2012
- DOI :
United KingdomClick to Access:
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While the national statistical definition of an SME follows the EU in terms of the number of employees, SME loans are defined by turnover, either up to GBP 1 million or up to GBP 25 million, depending on the source of the data. 94.9% of enterprises have 1-9 employees. Following a period of growth, the stock of lending to SMEs peaked in 2009 and has declined in subsequent years. Lending to large enterprises also peaked in 2008, but declined more sharply than SME lending in 2009. The decline in the stock of lending was affected by both supply-side factors, as well as demand-side factors, with evidence indicating that SMEs were deleveraging and repaying existing bank debt. The SME share in total business lending, for SMEs with less than GBP 1 million turnover, has remained stable but is very small (11.6%) compared to other countries in the OECD Scoreboard on financing SMEs and entrepreneurs, as it does not include all lending to larger SMEs. Other evidenceBank of England (2011), Trends in Lending, April 2011. Available at: www.bankofengland.co.uk/publications/other/monetary/TrendsApril11.pdf suggests total lending to SMEs (with up to GBP 25 million turnover) accounts for around a quarter of the stock of lending to all UK businesses, which is more in line with other countries.