Evaluating the Effectiveness of SME Financing in Iran (Case of Export Development Bank of Iran and Bank of Industry and Mine)

By reviewing prosperous countries, the spinal cord of economic development comes from supporting the small and medium enterprises (SMEs). Iran as one of the countries that have remarkable petroleum incomes has a great potential to allocatefunds into producer parts of economics such as SMEs. On the other side, financing SMEs because of their nature and features is harder than large enterprises. In comparison with large enterprises, SMEs need less capital to start the lifecycle andhave a high effectiveness on the economic growth but the way that these enterprises finance is a big issue. In each country based on their definition of SME, there maybe the various potential of SME financing mechanisms. In case of Iran, Banks loans are a major way that SMEs can access to finance but according to GlobalCompetitiveness Report, Accessing to Finance is the most problematic factors for doing business in Iran.

Keywords:

Small and medium enterprises , SME financing , Bank loan