Banks’ lending decisions to small firms are not based on financial ratios, while suppliers lend to clients with strong sales. So entrepreneurial firms might find it easier to borrow from banks, and rely more on bank lending than on supplier lending. We further find that suppliers are quite...

The history of the Industrial Revolution in developed and developing countries has shown that small and medium enterprises are the driving force of industrial and economic development. This paper examines the impact of the role played by microfinance banks (MFBs) in promoting the growth of SMEs...