The Assessment (Pathology) of SME Financing With Respect to Experiences of Other Countries

The importance of the role of firms in classical economic growth literature and economic crisis assurance has made the countries to consider the financing of firm asan important issue. Dependency on oil revenue as significant dimension of economic structure of Iran, significant share of public sector of these revenues ,basicrole of banking sector in Iranian money and financial markets, changes in fundamental economic variables together with the imposition of sanctions on Iranspecifically banking system ,has made the financing for micro ,small, and medium firms more important In this study we provide the position and process of financingfor SMEs in Iran. We have found the direction of financing is concentrated on banking system. This is when the banks are involved with many problems of theirown; like mandatory directives (which has no relevance to Iran economic situation). On the other hand, manufacturing firms, particularly SMEs as the engine of economicgrowth face financial problems, regulations and market structures. To get over widespread stagnation there is no way but to establish the relation between supply anddemand of finance. The experiences of other countries have shown that fundamental changes in approaching SME financing is necessary after economic crisis. That is whyin this paper we have introduced the new proposals and policies according to economic and particularly banking situation and specifically SME financing as anew approach in financial and banking sector of Iran.

Keywords:

Small and Medium Size Firms , Banking System , Financial Obstacles , Sanction