Determinants of Bank-Tunisian SMEs Funding in a Context of Information Asymmetry

Romdhane, Syrine Ben; Jebali, Emna

doi:10.20448/2002.131.1.14

Cited by 3 publications

(4 citation statements)

References 41 publications

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“…In view of the current situation and existing problems of China's SME financing model, (Zhang & Fan, 2018) proposes a new financing model for SMEs based on cloud services under the guidance of the government, integrating multiple social resources, improving the transparency and immediacy of SME financing information and reducing the risks of investors and online platforms. Furthermore, the reputation of SMEs among their business partners plays an important role in accessing bank credit, and there is a need to adjust the behavior of banks and SMEs in order to improve their access to finance and thus improve bank-SME partnerships (Romdhane & Jebali, 2021). (Wang & Zhang, 2021) established a reputation evaluation model for SME financing risk to provide reference information for financial institutions to invest in SMEs, promoting good credit partnership between financial institutions and SMEs.…”

Section: Literature Reviewmentioning

confidence: 99%

Study on the Integrated Financing Credit Service Model for Small and Micro Enterprises

Sun¹

2023

Atlantis Highlights in Intelligent Systems

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Deepening financial services for small and micro enterprises is an important decision of the Party Central Committee and the State Council, yet the problem of financing difficulties for small and micro enterprises has not been effectively solved, which has seriously hindered the stable development of small and micro enterprises. In order to promote the construction of a national integrated financing credit service platform network to achieve high-quality development of small and micro enterprises, this study uses literature research and example analysis to analyse the development dilemma of integrated financing credit services in China, design the framework structure of the integrated financing credit service platform and explore the new model of integrated financing credit services in China in combination with the construction of a typical Chinese constructionthe Qingdao station of CeLoan platform. The new model of integrated financing credit service with special features is proposed to strengthen the support of credit to the financing of small and micro enterprises, improve the platform system and help banks and other financial institutions to improve their ability to serve small and micro enterprises and other feasible suggestions, so as to promote the transformation and upgrading of China's economy.

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Section: Literature Reviewmentioning

confidence: 99%

Study on the Integrated Financing Credit Service Model for Small and Micro Enterprises

Sun¹

2023

Atlantis Highlights in Intelligent Systems

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“…A study conducted in Algeria shows the difficulties of MSMEs in accessing financing services from the bank due to the asymmetric information problem, and the study suggests the importance of the banking industry and MSME segment to adjust their behaviours to improve the conditions and access to information; hence, improving the confidence for both parties in their financing relationship (Abdelhafid and Mohammed, 2019). Furthermore, Romdhane and Jebali (2021) explore the determinant of access to finance for MSMEs in Tunisia with regard to information asymmetry; their study concluded that the bank's financing of Tunisian small and medium-sized enterprises (SMEs) was characterised by the conditions dominated by the issues of asymmetric information. Their study further reveals the distinct treatment faced by SMEs that operate in different sectors due to the varied information asymmetry profiles.…”

Section: Mitigating Asymmetric Informationmentioning

confidence: 99%

“…Their study further reveals the distinct treatment faced by SMEs that operate in different sectors due to the varied information asymmetry profiles. In this matter, the Tunisian banks seem to consider giving loan service to SMEs that operate in the commercial-based sector, although the loan was granted with higher interest rates, and will likely dismiss the access to credit for SMEs that operates in the service-related sector because of excessive risk concern (Romdhane and Jebali, 2021). Interestingly, evidence from Italy with a more sophisticated financial system shows that SMEs with better private fundamentals are more likely to access the bond market, signifying that the SMEs with better information profiles will have greater access to alternative funding other than traditional bank financing; thus, reducing the problem of financial exclusion for this potential sector (Iannamorelli et al , 2020).…”

Section: Literature Reviewmentioning

confidence: 99%

Mitigating asymmetric information to enhance MSME Islamic financial inclusion by Islamic banks in Indonesia

Saifurrahman

Kassim²

2022

QRFM

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Purpose This study aims to explore and analyse the credit risk assessment procedure conducted by the Indonesian Islamic banks to address the issue of asymmetric information among their micro-, small- and medium-sized enterprise (MSME) clients. This study also investigates the gaps in credit risk assessment procedures by comparing Islamic banks’ practices and presenting several recommendations to reinforce the credit risk evaluation procedures and eventually promote more inclusion of the MSME segment into the Islamic financial services. Design/methodology/approach This paper adopts a qualitative method by implementing a multi-case study research strategy. The data were gathered primarily through an interview approach by incorporating purposive uncontrolled quota sampling. Findings The result of this study implies that the Islamic banks in Indonesia have their own unique approaches and strategies in assessing the credit risk and have several similarities in performing their evaluation procedures for the MSME. Despite seemingly adequate approaches and measures taken by the Islamic banks to eliminate the asymmetric information problem, the study identifies several gaps that occur within the Islamic banks’ methods of credit risk assessment. Research limitations/implications Since this study focuses on Indonesia and emphasises the two segments of Islamic banks, which consist of Islamic commercial and rural banks, in performing the MSME credit risk assessment; therefore, the findings of this study were limited around the observed Islamic banks within the MSME segment purview. Practical implications By referring to the recommendations as proposed by this paper, four implications could be expected from adopting these respective recommendations, among others: more effective evaluation procedures for the MSME, provision of a clear path and more efficient approach to assess the MSME units, lower financing cost and increase the confidence of Islamic banking industry in disbursing more financing to the MSME sector. This mechanism will potentially improve Islamic financial inclusion for the MSME due to the greater access to financial services; hence, the sector could contribute even more to Indonesia’s growing economy. Originality/value By incorporating a multi-case study among Indonesian Islamic banks pertaining to their methods in evaluating MSME customers, this study identifies several gaps affecting the effectiveness of MSME credit risk assessment. Furthermore, this study also presents a proposed framework to address these gaps accordingly by suggesting the salient strategies to minimise the issues of information asymmetry and enhance the MSME credit risk assessment procedure.

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“…W, 2015;Nahar & Sarker, 2016;Umiyati & Ana, 2017). (Romdhane & Jebali, 2021) also mentioned that location can affect the provision of credit or financing services. Thus, this study uses the variable number of branch offices to represent access to financial services.…”

Section: A Introductionmentioning

confidence: 99%

Determining Factors of Working Capital Financing of Micro, Small, and Medium Enterprises (MSMEs) in Islamic Banking: An Empirical Evidence from Indonesia

Maghfirlana

Sulaeman

2021

JMSR

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This study aims to analyze empirically the determinants of the working capital financing of MSMEs under dual-banking system like Indonesia in the period January 2015 to April 2022. By using the selected variables and the time series data analysis method, namely the Error Correction Model (ECM), this study found that: (1) In the short term, the NPF variable have a significant effect on the decline in the distribution of capital working financing in Islamic banking in Indonesia; (2) In the long term, the variables of number of branch offices and ROA have a significant influence in increasing the number of working capital financing distributions for MSMEs in Islamic banking in Indonesia. Meanwhile, the inflation variable does not have an influence on the amount of Islamic banking financing distribution in Indonesia, both in the short and long term. This research is expected to contribute to policy making related to Islamic banking financing for the MSMEs sector in Indonesia.

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Determinants of Bank-Tunisian SMEs Funding in a Context of Information Asymmetry

Cited by 3 publications

References 41 publications

Study on the Integrated Financing Credit Service Model for Small and Micro Enterprises

Study on the Integrated Financing Credit Service Model for Small and Micro Enterprises

Mitigating asymmetric information to enhance MSME Islamic financial inclusion by Islamic banks in Indonesia

Determining Factors of Working Capital Financing of Micro, Small, and Medium Enterprises (MSMEs) in Islamic Banking: An Empirical Evidence from Indonesia

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