Finance of small business firms in times of austerity

This Briefing Note looks at the problems of SME finance in the euro area. It describes the extraordinarily large share of SMEs in the EU political tissue. It finds that SMEs are more handicapped in accessing bank finance than large companies, but they have alternative ways of finding finance notably by delaying payments of bills. It is then argued that the financial difficulties of small businesses are caused by the austerity policies pursued in most Member States, which destroy financial wealth. SMEs are handicapped by their corporate structure to get a fair share in a shrinking pie of available finance