As is the case in many other developing economies, access to and the cost of finance is a major constraint to SME growth. Banks will not lend and investors will not invest thinking that small businesses are high-risk. Against study to assess and better understand issues facing Sri Lankan SMEs when it comes to accessing finance. The study argues that improving access to finance for SMEs is a case of improving ‘availability’ on the one hand, and improving ‘bankability’ on the other. The study largely focuses on the second pillar – ‘bankability’. This stems from the understanding that a flush of SME credit alone is not enough. ‘Bankability’ is about improving banks’ approach to SME lending as well as improving SMEs’ ability to approach banks. The study, drawing on international experiences also goes on to identify new ways in improving access to finance in Sri Lanka.
