Small enterprises' access to finance and collateral registries

Small enterprises have a great impact on the economies' of countries as they are approximately 99% of all enterprises. Data for several macroeconomic indicators like employment and turnover supports this argument. Criteria used for the classification of enterprises in terms of scale differ from country to country. However, in all countries, what is meant by small enterprise is enterprises out of large scale enterprises in general. Access to finance is one of the most important problems for small enterprises. The limited diversity of financial instruments is a clear sign of access to finance problem of those enterprises. Small enterprises in Turkey also have access to limited number of financial instruments. There are several obstacles underlying this problem. The most significant of them is the collateral problem. In order to solve the collateral problem, collateral registries which enable the acceptance of movable assets as collateral are established in many countries. In this context, the aim of this study is to determine a road map in Turkey by benefiting from the experiences of other countries for the establishment of a collateral registry, which is supposed to improve small enterprises' access to finance. Key words: Small enterprise, criteria, problem of access to finance, collateral, collateral registry