Estimating Conditional Treatment Effects of EIB Lending to SMEs in Europe

Categories : Customer and Users of Digital Payments, MSME's


Author: Bank of International Settlements

Small and medium-sized enterprises (SMEs) play a key role in the economy of the European Union. Yet, SMEs often find it more challenging to access finance than their larger peers. The gap between the demand for credit from financially viable SMEs and the actual credit supply, is known as the “SME financing gap”. Among international financial institutions, the European Investment Bank (EIB) stands out in terms of annual lending volumes to SMEs. Previous research has shown that EIB-supported lending has a positive effect on the employment levels, size, investments and innovation capacities of SMEs. However, it remains unexplored whether these impacts vary based on different types of recipients, or by the parameters of the financial support – such as the cost of a loan, its maturity or volume.

The purpose of this study  by the BIS is to assess the impact of the EIB support on the final beneficiary firms for different subgroups of treated firms.