FINANCING OF SMALL AND MEDIUM ENTERPRISES – CASE OF MACEDONIA

Abstract

This paper is prepared in a clear structure, in order to clarify in details microfinance, as a method for SMEs in accessing financing sources. At the beginning microfinance has been developed as an opportunity to help poor people lift themselves out of poverty. The most important thing is that microfinance helps people to open new businesses and with that improve economic and social condition of the society. It is done knowing the great need for access to financial resources, and also for other ways of support, either informal or nonfinancial methods. In this study, the importance is given to the development of microfinance in Macedonia, it is about the stages that have been performed and the results so far achieved. Knowing the methods of financing SMEs in other countries, the main issues that we have analyzed are the sources and methods of financing SMEs in Macedonia. In order to make the evaluation of these factors, we have used regression analysis on three variables.Finally there are presented the results obtained from empirical analysis, where we have analyzed the amounts of credits allocated to SMEs, the number of active enterprises, and the change of interest rates for SME loans, all these are made ​​for a period from 2004 - 2012 (divided into quartiles). The results clarify the impact of credits and interest rates on the existence of SMEs and the opening of new enterprises in Macedonia. To our bad luck, the obtained results do not match with the results of other countries, while the reason is explained at the end of the study.

Keywords

• Microfinance,Small and Medium Enterprises (SME),lending,banks,business support agency

References

1. Armendaris B. Morduch J. 2010. The Economics of Microfinance – second edition. The Mitt Press, Cambridge. Page 13. Dehejia R. Montgomery H. Morduch J. 2005. Does interest rates matter? Page 19. Kinyori W. Jakobi N. 2005. A dual case study of micro, small and medium enterprises in the Microfinance sector in Kenya and Germany. UMEA University. Page 2. Stefanoski D. 2008. Financial Opportunities for SMEs in R. of Macedonia. Union of Economic Chambers in Macedonia. Woosley L. Padhi M. Frame W. 2001. The Effect of Credit Scoring on SME Lending in Low and Moderate Income Areas. Working Paper 2001-6. Bank Of Atlanta. Woradithee W. 2011. Financial Sustainability of Microfinance - Mater thesis. Uppsala University. Page 4. Gunasekaran, A., Rai, B., & Griffin, M. (2011). Resilience and competitiveness of small and medium size enterprises: An empirical research. International Journal of Production Research, 49(18), 5489-5509. Jorgensen, A. L., & Knudesen, J. S. (2006). Sustainable competitiveness in global value chains: How do small Danish firms behave. Corporate Governance, 8(4), 449-462. Karaev, A., Koh, S. C. L., & Szamosi, L. T. (2007). The cluster approach and SME competitiveness: A review. Journal of Manufacturing Technology Management, 18(7), 818-835. Levy, M., Loebbecke, C., & Powell, P. (2003). SMEs, cooperation and knowledge sharing: The role of information system. European Journal of Information System, 12(1), 3-17. Lu, J., & Beamish, P. (2001). The internationalization and performance of SME. Strategic Management Journal, 22(6-7), 565-586. Nelson, R. (1992). Recent writings on competitiveness: Boxing the compass. California Management Review, 34(2), 127-137. Nunes, P. M., Serrasqueiro, Z., & Leitão, J. (2010). Are there nonlinear relationships between the profitability of Portuguese services SMEs and its specific determinants?. Service Industries Journal, 30(8), 1313-1341. O’Farrell, P. N., Hitchens, D., & Moffat, L. (1992). The competitiveness of business services firms: A matched comparison between Scotland and the South East of England. Regional Studies, 26(6), 519-525. Oliveira, P., & Teixeira, A. A. C. (2011). The internationalization profiles of Portuguese SMEs. FEP Working Papers No. 439. Ozgulbas, N., Koyuncugil, A. S., & Yilmaz, F. (2006). Identifying the effect of firm size on financial performance of SMEs. The Business Review, 6(1), 162-167. Poon, S., & Swatman, P. M. C. (1999). An exploratory study of small business Internet commerce issues. Information and Management, 35(1), 9-18. Pratten, C. (1991). The competitiveness of small firms. Occasional Paper 57, Department of Applied Economics, University of Cambridge. Cambridge, UK: Cambridge University Press. Ramasamy, H. (1995). Productivity in the age of competitiveness: Focus on manufacturing in Singapore. In Productivity in the Age of Competitiveness, APO Monograph Series (16), Asian Productivity Organizations, Tokyo. Ruzzier, M., Hisrich, R., & Antoncic, B. (2006). SME internationalization research: Past, present, and future. Journal of Small Business and Enterprise Development, 13(4), 476-497. Salavou, H., Baltas, G., & Lioukas, S. (2004). Organizational innovation in SMEs: The importance of strategic orientation and competitive structure. European Journal of Marketing, 38(9-10), 1091-1112. www.stat.gov.mk www.nbrm.mk