In February 2011 LFS was commissioned by KfW to carry out an Option & Design Study for an SME finance project to be implemented in the framework of Syrian-German Financial Co-operation. MSMEs in Syria have only limited access to credit and other financial services; and the objective of an SME finance project would be to increase SMEs’ access to finance in an economy which is still in the process of transformation into a social market economy, with strong legacies of a state-dominated economy such the domination of state-owned banks, private banks being allowed only since 2004. The project consists of two phases. Phase I, the Options Study, was carried out in March 2011
In Phase I LFS (i) reviewed existing SME promotion policies in Syria, (ii) analyzed the Syrian financial sector, identifying impediments to the provisions of loans and other financial services to SMEs, (iii) described existing initiatives of donors and banks to serve the SME market, and (iv) developed options for an SME finance project with commercial banks and microfinance institutions.