Peculiarities of lending to small and medium-sized businesses in times of war

Abstract

Lending to small and medium-sized businesses is a complex process that has its own characteristics and requires a careful approach. For such enterprises, it is important to have access to financial resources on favorable terms, but there are often restrictions and risks that must be taken into account. Also, small and medium-sized businesses may need not only financial support, but also management and development consulting. During the war, lending to small and medium-sized businesses becomes even more important and has its own characteristics. It becomes part of the economic mechanism, which is aimed at supporting domestic production, preserving jobs and the general economic development of the country in wartime conditions. In such conditions, lending to small and medium-sized businesses can aim not only to ensure their financial stability, but also to support the production of important goods and services for defense needs, as well as reconstruction after destruction. On the other hand, war is usually accompanied by economic hardship, which can lead to reduced credit resources and increased credit risks. It is therefore important that the government and financial institutions take steps to maintain the availability of credit for small and medium-sized enterprises during this difficult period.. The work describes the tools for supporting small and medium-sized businesses during the period of martial law in Ukraine. The advantages and disadvantages of bank lending for small and medium-sized businesses are determined. Based on this, the peculiarities of lending to small and medium-sized businesses in wartime conditions are highlighted. The general dynamics of lending volumes under the state program "Affordable loans 5-7-9%" were studied. An assessment of the dynamics of lending to small and medium-sized businesses in Ukraine since the beginning of the war has been carried out. The top-5 largest domestic banks that provided loans to medium-sized businesses in Ukraine during 2022 were considered. An analysis of crediting of small and medium-sized businesses in Ukraine during 2019-2022 was carried out, and a comparison of the interest rates at which they received credit resources during the analyzed period.