Improving the SMEs Access to Trade Finance DRAFT
in the OIC Member States
38
While sources of trade finance remain concentrated on a global basis, it is evident that there is
increasing interest in the financing of international commerce, and that the sources of liquidity
and financing targeted at trade activity will increase in the medium term.
1.7. Importance and Common Challenges for SMEs in Accessing
Financing and Trade Finance
The critical role of small businesses creating economic value and in generating employment is
well-known among development practitioners and within international institutions, and has
gained increasing profile and priority in the political context, even as small businesses
continue to report challenges in accessing affordable and timely financing, including trade
finance.
Small and medium-sized enterprises, globally, face challenges in accessing timely and
affordable financing: a systemic reality that may be showing signs of favourable shift as a
direct result of the global crisis, the redesign of global trade flows and the increasing
realization of the importance of SMEs to economic growth and value creation.
Figure 14: SME Obstacles to Growth
Source: How to Access Trade Finance, UN ITC, 2009
At the same time, SMEs, and particularly those in developing and emerging markets, continue
to report difficulty in accessing financing and consistently report that financing costs are high
relative to other customer segments. The graphic above illustrates that SMEs are concerned
about both the high cost of financing (fourth item from left) and inadequate access to financing
(sixth item from left). Limitations on access to finance are consistently identified as a
significant obstacle to growth and long-term sustainability of small businesses.