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The bank–SME relationship and rationing risk reduction: an empirical study on survey data

Author

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  • Mohamed Oudgou

    (Laboratory LAREMO, ENCG Béni-Mellal, University Sultan Moulay Slimane)

  • Abdeslam Boudhar

    (Laboratory LAREMO, ENCG Béni-Mellal, University Sultan Moulay Slimane)

Abstract

The purpose of this article was to assess the impact of the bank–SME relationship on SMEs' risk of credit rationing in the medium and long term. This goal stems from the convention theory hypothesis which states that the use of bank debt by SMEs does not only depend on the performance levers achieved but also on the establishment of a bank–firm relationship based on commitment. To test this hypothesis, we constructed a sample of 210 SMEs on which is collected accounting and financial data, then investigated via a survey to collect data on the banking relationship. The main results of the econometric investigations carried out by the Stepwise method of the Logistic regression model show that certain measures of the banking relationship significantly reduce the exposure of SMEs to bank credit rationing. In particular, the credit history, the level of social contact with the bank manager and the communication channel used between the firm and the bank.

Suggested Citation

  • Mohamed Oudgou & Abdeslam Boudhar, 2023. "The bank–SME relationship and rationing risk reduction: an empirical study on survey data," SN Business & Economics, Springer, vol. 3(8), pages 1-39, August.
    • Handle: RePEc:spr:snbeco:v:3:y:2023:i:8:d:10.1007_s43546-023-00518-0
    DOI: 10.1007/s43546-023-00518-0
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    More about this item

    Keywords

    Bank-SME relationship; Rationing; Asymmetric information; Collateral; Logistic regression;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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