SMEs : UNDERSERVED ECONOMIC POWERHOUSES
In the complex global economy, the unwavering heroes are Small-to-Medium-Sized Enterprises (SMEs), or Small-to-Medium Businesses (SMBs). SMBs are driving innovation, contributing significantly to GDP, and creating jobs in every sector in every market. Despite being the champions of the economic landscape, they’re still at the back of the line when it comes to getting fast, favorable access to credit. There is an enormous funding gap for SMEs - a global gap to the tune of at least $5.2 trillion annually, according to the International Finance Corporation (IFC). Overall, 40% of SMEs worldwide don’t have access to the funding they need to operate. While Canada is able to approve 90.8% of loan applications, the US still has a sizable lending gap. Canada’s small-to-medium businesses benefit from strong government support programs like CSBFP, credit guarantee schemes, and robust banking regulations that help banks reduce lending risk. Conversely, the US has a more complex banking system that is harder to navigate, despite SBA programs . In March 2023, the highest SME loan approval rate in the US was only 28%.
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