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Lending at the Intersection of Micro and SME Finance (Compilation)

Institutional Sponsor: 
United States Agency for International Development
Publication date: 
Tuesday, March 31, 2009

Speakers Corner #33 on the subject of "Lending at the Intersection of Micro and SME Finance"

This discussion is facilitated by Arun Hsu, Mary Miller and Christina Strong.  Small and medium enterprises account for as much as 60 percent of GDP, 97 percent of firms, and 70 percent of employment in both developed and developing economies. The importance of the SME sector as the driver for private sector growth in developing and transitional countries is well recognized by the donor community.  During the last several years, donors have increasingly deployed resources aimed at improving SME access to finance.

What are the key success factors that enable microfinance institutions to move up market and lend to SMEs? What are the main differences between underwriting a micro versus an SME loan?  What characteristics of a business dictate when an SME lending approach is more appropriate?  What tools and approaches can be used to improve and speed up the credit screening and underwriting process for the lower end of the SME spectrum? These are some of the questions that were addressed in this Speakers Corner.