The banking financial credit and the capacity promotion of small and medium enterprises in Palestinian

Abstract

The study aims at studying the role of banking sector in funding small and medium enterprises, and to illustrate the importance roll and the efficiency to enhance the effectiveness of small and medium enterprises in Palestine. To achieve the study goals and to prove the hypotheses, the researcher used a descriptive analysis method and an econometric model to analyze the relationship between different variables in the study. The study concluded that, the banking system do not have interest concerning funding of small enterprises, where, the funding percentage was less than 3% of total financial credit. However, the Palestinian economy depends mainly nowadays on small enterprises which form 89% of total business entities, while, medium enterprises form 9.9%. The study recommends the necessity of applying some policies, which can raise the efficiency and effectiveness of small, and medium enterprises in order to develop the Palestinian economy as a whole, this step can be applied by providing some consulting services, decreasing interest rates and taking a free-tax policy.