Difference between revisions of "SME Lending"

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== Definition ==
 
== Definition ==
'''SME Lending''' denotes any of a wide array of loan or related financial products that provide financing to [[wikipedia:Small and medium-sized enterprises | small or medium sized enterprises]]
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'''SME Lending''' denotes any of a wide array of loan or related financial products that provide financing to [[wikipedia:Small and medium-sized enterprises | small or medium sized enterprises]].  A more granular approach defines Micro, Small and Medium Enterprises.
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=== SME Definition Criteria ===
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SME's can be distinguished by large corporate entities on the basis of a number of criteria
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* Number of Employees
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* Annual Sales / Turnover
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* Fixed Assets
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* Invested Capital
  
 
== Business Models ==
 
== Business Models ==
SME Lending is typically provided by banks. Additional channels may include [[Securitisation]] and [[Peer-to-peer Lending]] (Marketplace lending or crowdfounding)
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* SME Lending is typically provided by banks. Additional traditional channels included some form [[Securitization]]
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* Recent approaches (Digital SME Finance) include [[Peer-to-peer Lending]] (Marketplace lending or crowdfounding) and [[SME Invoice Financing]]
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Dimensions that differentiate SME Lending Business Models:
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* The underwriting process ([[Credit Origination]])
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* The [[Credit Portfolio Management]] approach
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* The funding approach
  
 
== Regulatory Status ==
 
== Regulatory Status ==
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== Accounting Status ==
 
== Accounting Status ==
* SME loand would be typically accounted under [[IFRS 9]] (or [[CECL]]) accounting rules
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* SME loans would be typically accounted under [[IFRS 9]] (or [[CECL]]) accounting rules
  
 
== SME Credit Risk Models ==
 
== SME Credit Risk Models ==
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* models producing [[Risk Parameters]] for internal risk management and regulatory purposes
 
* models producing [[Risk Parameters]] for internal risk management and regulatory purposes
 
* a specialized [[Credit Portfolio Model]]
 
* a specialized [[Credit Portfolio Model]]
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== See Also ==
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* [[SME Credit Risk Literature]]
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== References ==
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<references/>
  
 
[[Category:SME Credit Risk]]
 
[[Category:SME Credit Risk]]

Latest revision as of 15:02, 27 June 2019

Definition

SME Lending denotes any of a wide array of loan or related financial products that provide financing to small or medium sized enterprises. A more granular approach defines Micro, Small and Medium Enterprises.

SME Definition Criteria

SME's can be distinguished by large corporate entities on the basis of a number of criteria

  • Number of Employees
  • Annual Sales / Turnover
  • Fixed Assets
  • Invested Capital

Business Models


Dimensions that differentiate SME Lending Business Models:

Regulatory Status

  • Capital requirements for SME exposures are set separately from corporate or retail exposures (see ASRF)

Accounting Status

  • SME loans would be typically accounted under IFRS 9 (or CECL) accounting rules

SME Credit Risk Models

Similar with other credit assets, SME credit risk models will include

See Also

References

Contributors to this article

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