The International Finance Corporation (IFC) hosted a discussion on the implications of the MSME finance gap for development institutions working on financial inclusion around the world. 

Sizing MSME finance gap is crucial for international stakeholders to target the high potential growth areas and hence more efficiently support MSME sector development. A year-long collaboration between IFC, World Bank, SME Finance Forum, and the IMF, has resulted in the only comprehensive global study, which, by comparing supply and demand of finance, estimated a $5.2 trillion MSME finance gap across 128 developing countries.

The potential demand for MSME finance is estimated at US$8.9 trillion, compared to the current credit supply of US$3.7 trillion. The study also estimates $2.9 trillion potential demand for MSME finance in the informal sector by investigating the size of the shadow economy. The findings are of significant value for private and public sector, including, the G20 and DFIs. 

Mr. Hans Peter Lankes shared insights from the study and development finance professionals from the World Bank, IMF, EIF and IADB provided their feedback on how their respective institutions address the shortage in financing among MSMEs.

Opening Remarks:
Manuela Adl - Senior Manager, Financial Institutions Group, IFC

Speaker: 
Hans Peter Lankes - Vice President, Economics and Private Sector Development at IFC (view presentation)

Moderator:
Matt Gamser - CEO of SME Finance  Forum 

Panelists:
Maria Soledad Martinez Peria - Division Chief, Macro Financial Division at IMF (view presentation)

Helmut Kraemer-Eis - Chief Economist at European Investment Fund (view presentation)

Roland Michelitsch - Principal Specialist, Economics and Private Sector Development at Inter-American Development Bank (view presentation)

Learn more:

MSME Finance Gap: Assessment of the Shortfalls and Opportunities in Financing Micro, Small and Medium Enterprises in Emerging Markets (Read the report)

Small businesses need financing to grow and create jobs. Matthew Gamser, the CEO of the SME Finance Forum (managed by IFC), discusses the staggering $5.2 trillion financing gap for micro, small and medium enterprises and what governments, banks and fintech companies can do to address this. (Watch the interview)

Webinar releasing new IFC data on financing for micro, small and medium-sized enterprises from SME Finance Forum on Vimeo.