Supply Chain Frontiers issue #49
The Malaysia Institute for Supply Chain Innovation (MISI) has published a white paper titled Financing SME Supply Chains. The research that forms the basis of the paper was supported by the SWIFT Institute, the Belgium-based organization that fosters research on global financial services.
Small and medium-sized enterprises (SMEs) are key drivers of economic growth in Asia, but they often lack the financial supply chain management expertise that is found in larger organizations. As a result, finance is a limiting factor in their development.
The white paper looks at the underlying causes of the problem and the government efforts to provide solutions. Thailand, for example, has created a number of financial organizations to promote SMEs. Despite these efforts, the constraints persist. The authors use case studies and interviews to provide insights into the after effects, such as a lack of working capital for SMEs.
A number of possible solutions are proposed. The authors argue that a holistic approach is needed to address the end-to-end flow of finance in the SME supply chain. MISI is seeking to develop a framework that links SME needs for capital with the role of these organizations in the supply chain.
For more information on the white paper and MISI’s research on SME supply chains, contact Dr. Asad Ata, Director of Graduate Programs at MISI, one of the authors of the paper.