Alternative Finance for SMEsMatthew GamserHead, SME Finance Forum and Women’s Finance Hub

SME Finance Forum and Women’s Finance Hub

Promotes and disseminates knowledge and good practices to accelerate financial inclusion for SMEs and women entrepreneurs

Owned by G20 Global Partnership for Financial Inclusion (GPFI) and managed by the International Financial Corporation (IFC)

IFC SME Products

IFC MSME Financial Intermediary Portfolio, Jun 2013

Volume of MSME Loans by IFC MFI and SME Clients

MSME Finance Gap

45-55% of MSMEs have unmet financial needs

Access to Finance is a Major Constraint for SMEs

Challenges faced by HGSMEs in emerging economies

Challenges faced by formal SMEs in emerging economies

High Growth SMEs Create Disproportionate Number of Jobs in Emerging Economies

According to the Enterprise Survey, HGSMEs consist of 16.4% of SMEs but are responsible for 38% of job growth

SME Financing Needs Vary by Stage of Development

HGSMEs Need Innovative Financing Structures

Banks are not incentivized to seek out and back high-growth SMEs. Yet these high-growth firms have not yet reached the scale to access capital markets.

Private equity (PE) is incentivized to seek out high-growth SMEs, but reaches only a small fraction of them due to high transaction costs and information asymmetries.

Leasing

Supply Chain Finance

IFC provides essential working capital to firms in emerging economies, propelling goods through the economic value chain

Private Equity

Investments by PE funds in SMEs produced a growth rate of 18%, almost twice the rate of job growth in non-SMEs (9.7%)

Among IFC PE funds, there is a positive correlation between fund returns and job creation

Crowdfunding

Importance of Financial Infrastructure for SMEs

Investment Unlocked Through Moveable Collateral Projects Dwarfs IFC Direct Investment in China and Ghana

On the Web at

www.smefinanceforum.org

www.womensfinanhub.org

LinkedIn Group: SME Finance Forum

Twitter: @SMEFinanceForum