Problems in SME Financing
Challenges in SME Financing
• Information asymmetries between investors and entrepreneurs
• Higher risks associated with small-scale activities
• Sizeable transaction costs associated with SME financing
• A lack of collateral by SMEs for loans.
• Create information symmetry by using Blockchain
• Reduces Investment Risks with smart contracts and information consistency • Decreases transaction cost without third parties (Financial Institutions)
• Lessens the need for collateral by providing services such as Identity Management, Contract Management, Reputation System and Arbitration Mechanism.