Capital is key to scale-up success, yet access to financing is one of the greatest challenges for SMEs today. The reasons are numerous: they are inherently more vulnerable investments—often not rated and with more fickle financing than larger organisations.
During the 2009 economic crisis for example, SMEs were the first to suffer. They are also more likely than larger established businesses to bootstrap their operation, or seek loans from banks.
However, on a global scale, approximately half of all SMEs lack access to credit according to the World Bank. This discrepancy between current supply and potential demand for credit is called the financing gap. If left unreconciled, this phenomenon can lead to decreased growth, so ensuring SMEs have access to sufficient funding is essential.