Access to external finance for small and medium-sized enterprises
Limited access to external financing is one of the key barriers impeding development of entrepreneurship in Belarus. The aim of this study is to analyze the access of SMEs to various tools of external financing. The analysis is based on the results of the business survey conducted in May 2015. It reveals that the bulk of the demand for loans comes from businesses positively assessing their economic situation and willing to work in a competitive environment. However, the number of businesses that need loans is twice larger than the number of those who actually get loans due to the the problem of high interest rates and collateral requirements. SMEs believe that the main instrument for solving the problem of access to external financing is to ensure the country’s macroeconomic stability, i. e. low inflation and a stable exchange rate. SMEs perceive the role of existing alternatives to bank lending and government policies aimed at improve access to external financing as very limited.