| Abstract [eng] |
Small and medium businesses account for over 99 % business entities in Lithuania. Each year these companies generate about 70 % of total value added and provide more than 70 % of jobs. SMEs make a significant contribution to the country's performance and are essential for economic development and social stability. To ensure a sustainable economy and its growth, it is necessary to create favorable conditions for the operation and development of SMEs. The scientific literature often examines the activities of this business segment and its contribution to the economy for a variety of purposes. Attention is also drawn to the most common problem faced by small and medium enterprises – limited access to finance. Typically, internal funds alone are not enough for the efficient functioning of a business, so it is forced to seek for other sources of funds. Otherwise it is difficult to ensure successful business operations and maintain a competitive position in the market. It is concluded that the country's economic growth partly depends on the ability to provide the necessary funding to SMEs. However, the current situation in the external capital market of Lithuania is doubtful. Traditional loans are still the main source of business financing, but Lithuania stands out with a high level of rejection of bank loans and the value of loans issued since 2017 is declining. Given the importance of external capital, it is considered that this may have a negative impact on the sustainability and development of business, as well as on the economic and social performance of the country. To assess the potential risks and consequences, it is important to identify the impact of bank financing on SME performance. In the case of the Lithuanian market, this area is not widely discussed in the literature, therefore the aim of this research is to assess the relationship between loans issued by monetary financial institutions and the main indicators of SMEs. |
