Banking financing for Romanian SMEs – challenges and opportunities

Nowadays, the importance of the SME field becomes more and more a real basis for establishing and developing a modern, dynamic knowledge-based economy because their capacity to stimulate private ownership and entrepreneurial skills; to be flexible and to adapt quickly to a changing market; to generate new jobs. The accession of Romania to the European Union involve a lot of challenges and among them, the SME development plays a central role. So, the Romanian Government settled up the main priorities regarding the development of the small business sector: creating a business environment supportive of SME development and growth; developing SME competitiveness; improving SME access to financing; improving SME export performance; promoting an entrepreneurial culture and strengthening management performance. An intrinsic constituent of this process is represented by the access of the companies to the financing which must be made in correlation with the adopted strategy of development, because this development needs time and, necessarily, the existence of the financing sources. The choice of these sources depends on the financial structure of the enterprise, on its financial situation. So, enterprises can choose between the internal sources and the external sources, the difference between these both being represented by their stability, their independence, their cost and the priority of the owners of capital in the situation of a bankruptcy. Even if the internal sources are most often preferred by the managers because they assure the independence of the enterprise, these are not always sufficient. In that case, companies use the external financing sources which also have advantages as the deductibility of the expenses with the interests, what makes them less expensive.