Abstract
Bankers’ Perceptions of Successful SMEs Loan Applications: A Case Study from Libya
Highlights
Small and medium-sized enterprises (SMEs) are of increasing importance for all national economies worldwide
This paper investigates the criteria used by loan officers at Bank Al Tanmeya when assessing SMEs loan applications and the most frequent reasons that lead to turn these applications down
The interviews had focused on gathering information on the eligibility criteria which loan officers at Bank Al Tanmeya consider when making decisions on accepting SMEs loan applications and reasons for such applications being rejected
Summary
Small and medium-sized enterprises (SMEs) are of increasing importance for all national economies worldwide. Remains a formidable obstacle in the development path of SMEs. remains a formidable obstacle in the development path of SMEs This is because lending institutions are reluctant to finance these firms because of their size, high risk of investment, and the level of information asymmetry. Access to finance has remained one of the key problems that keep confronting SMEs. There is wide agreement that the creation and growth of healthy and thriving SME sector are directly related to the ability to access to finance. Despite the fact that much of the finance used by SMEs is internally generated by businesses out of their owners’ savings and retained earnings, banks remain the most common external capital provider for such firms in both developed and developing countries mostly in the form of overdrafts and short term loans
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