Prospects for the Financial Instruments System Development for Small and Medium Enterprises

   Financial availability for small and medium-sized enterprises is the most important factor for the companies’ growth. The current structure of the financial market determines bank lending as the main source of attracting external financing. At the same time, SMEs are in need of alternative financing instruments, including equity financing.

   The purpose of the paper is to assess current changes in the attracted financing structure in the SME segment and determine the development prospects of a system of capital raising instruments.

   Due the purpose, two tasks were defined: to analyze the dynamics of financial availability and the need of target segment in modern convenient financial tools. The following scientific methods were used in the study: observation, comparison, retrospective and system-structural analysis, analysis by segments, generalization. The key advantages of individual financial instruments and factors influencing their development are identified. The risks of creating non-competitive conditions for the development of instruments due to different approaches to regulation, as well as the use of preferential lending programs, have been identified. To prove the proposed approach, an analysis of the depth of lending penetration in the micro, small and medium-sized business segments, as well as the dynamics of the involvement of new borrowers, was carried out. The promising role of equity financing is outlined, while the institutional consequences of involving citizens in the development process of Russian companies are highlighted. The risks of the lack of a long-term vision of the financing instruments structure in strategic documents are identified, which does not allow the formation of numerical guidelines for supporting various groups of instruments. The proposed study made it possible to identify a number of significant areas for the development of non-bank financing of SMEs. The work updates: the possibilities of forming a system of debt and equity financing that meets the future needs of the target audience. The author’s definition of the prospects for the development of a system of financing instruments for the SME segment is given, which is based on an analysis of the dynamics of individual financial instruments and a study of the long-term need for external financing at various stages of company development.

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