Small Business Economics

, Volume 41, Issue 3, pp 701-715

First online:

Perceived credit constraints in the European Union

  • Erik CantonAffiliated withEcorys Nederland
  • , Isabel GriloAffiliated withDG Economic and Financial Affairs, European Commission
  • , Josefa MonteagudoAffiliated withDG Economic and Financial Affairs, European Commission
  • , Peter van der ZwanAffiliated withErasmus School of Economics, Erasmus University RotterdamPanteia/EIM Business and Policy Research Email author 

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The promotion and support of small and medium-sized enterprises (SMEs) is an essential component of policies designed to help improve Europe’s economic performance. A crucial issue is whether SMEs face difficulty obtaining bank loans. Using pre-crisis survey data from 2005 and 2006 for nearly 3,500 SMEs (firms with fewer than 250 employees) in the European Union (EU), we investigate the determinants of perceived bank loan accessibility at the firm level and at the country level. Based on hierarchical (multi-level) binomial logit regressions, our findings show that the youngest and smallest SMEs have the worst perception of access to bank loans. The SMEs in nations with concentrated banking sectors are more positive about loan accessibility. In addition, a high fraction of foreign-owned banks is associated with improved perception of loan accessibility in the EU 15 but not in the EU 10.


Bank loans Money supply SMEs Credit constraints Concentration index Multi-level

JEL Classifications

E44 E51 G15 G21