The Project “SME Growth Opportunities and How Policies and Banks miss them” is funded by USAID Business Enabling Project. The Project duration was from July 2013 until October 2014. The purpose of this project is to motivate banks and other stakeholders to search for procedures and financing modalities more suitable to the SME market segment, than are current bank practices, by presenting strong evidence of missed opportunities with current practice. The purpose of the grant is to raise bank awareness that current bank credit practices miss opportunities for generating bank profit and enhancing SME growth, which will be achieved by conducting work on SME market segment and outreach activities with banks. Therefore, we organized two roundtables at National Bank of Serbia. The first on 19th of June 2014 and the second one on 7th of October 2014.

Expansion and development of the SME sector is both the opportunity and necessity for Serbian economy. Serbia’s truly large companies are few, and unlikely to provide the growth locomotive needed for the country’s development. Also, Serbia cannot expect that large foreign investors will enter in significant numbers and consequently enhance economic growth, as it happened in some transition countries prior to becoming EU member state. First and necessary condition, which will enable SMEs to become a key part of progressive, globally competitive industries, creating large number of jobs and generating income opportunities for their stakeholders, are supportive government policies and financial institutions with SME friendly practices. Good and fruitful cooperation between the SME sector and the financial sector, especially banks, is crucially important for achieving and sustaining economic growth. In Serbia’s case, increasing SME access to funding is probably the single most important measure that can be offered, other than providing a more stable and entrepreneurship-friendly legal and regulatory environment. Still, it is well known that Serbia’s enterprises are highly dependent on self-financing, and this suggests there is a large scope for expanding bank finance in the country.

Report – “SME Growth Opportunities and How Policies and Banks miss them”