Banks in the United Arab Emirates are cutting credit lines to small- and medium-sized businesses (SMEs) after a spate of defaults, posing a threat to one of the economy's main drivers. As weak oil prices prompt a drying up of bank liquidity, some lenders are becoming choosier, taking longer to approve loans or asking for more paperwork, while others are cutting lending or recalling loans, say businesses and bankers.
Despite its impressive growth, the P2P lending industry is not airtight. Fraudulent practices are on the rise particularly in economies where credit reporting institutions and financial consumer protection regulations are not well-established. In 2015 alone, 1,253 out of 3,000 Chinese P2P lending platforms were discovered as problematic, involving multiple Ponzi schemes.
The financial and economic crisis has brought to the fore small business banking’s key challenge: How can banks master the cost of risk and also accelerate development?
This report reflects work conducted by NIESR in October 2014, covering results from an informal consultation with stakeholders in the securitisation markets and a review of the academic and regulatory literature. It sets out areas of market failures that limit more active UK SME securitisation market.
The report offers an analysis of SME securitisation market in the UK, covering:
Attention for global regulatory changes and their effects in emerging economies has increased since 1 January 2013 marked the beginning of the implementation period of the third Basel Accord, commonly known as Basel III. The accord was called into life as a successor to Basel II, to restrain and stabilize international financial markets in the wake of the 2008 global financial crisis. Basel III was created by the Basel Committee on Banking Supervision, which sought to ease the deficiencies that had become evident during the crisis — high leverage ratios and very low capital requirements.
SMEs are the backbone of the European economy. The financing situation for European SMEs is slightly improving, but also differs very much from country to country. In Europe, SMEs’ financing strongly depends on banks and also after the crisis banks will remain the main external financing source for SMEs.
Europe’s 22 million SMEs provide 67% of all EU jobs and generate 58% of total EU value added, yet they still often face greater difficulty in accessing the finance they need than their larger competitors. The European Economy journal has brought together financial experts to debate how to address this problem in its latest issue: “Who takes the risks for funding SMEs?”
Europe’s SMEs are heavily reliant on bank loans with limited access to other types of finance. Yet equity finance is often more suitable for startups and growth companies and is available from diverse sources, such as family and friends, business angels, crowdfunders, venture capitalists and public markets. But the path to accessing this type of finance is not always clear…
