Abstract:
In this paper, we attempt to explore why banks possessing free assets and willingness to lend,
on the one side, and businesses lacking money, on the other side, do not meet. We are
looking for answers why all EU initiatives for more available funding for SMEs still haven’t
resulted positively and loan growth rate is more than modest.
The empirical part of the research is based on the quantitative and qualitative assessment of
the commercial banks, SMEs of Latvia and case studies of timber industry. The result of the
analyses has been discussed and recommendations have been provided for policy makers
and academician, opening new areas for this timely topic research.
