The Role of Credit Consortia in the Financial Structure of Sardinian Companies During the SARS-CoV-2 Crisis

In this paper, we analyzed the role of credit consortia in supporting SMEs of the Italian region of Sardinia around and during the SARS-CoV-2 pandemic crisis. Credit consortia (or credit guarantee schemes) are financial companies whose institutional role is to support small firms needing bank lending who are individually weak in the bank–firm relationship. Credit consortia are particularly relevant in Italy, where they mitigate credit restrictions for SMEs by supplying guarantees to the bank, allowing for partial coverage of potential losses, providing peer-monitoring activity, and collectively negotiating more favorable interest rates and other conditions with banks. During the SARS-CoV-2 pandemic, credit consortia had a crucial role in supporting Sardinian SMEs with guarantees and obtaining government financial support. The evolution of Sardinian companies’ financial structures during the SARS-CoV-2 pandemic shows that the confidi-supported firms have low capitalization and are financially fragile yet capable of good returns. The liquidity provided by the government during the pandemic loosened these constraints, boosting the available liquidity, which translated, in short, into higher investment and higher sales. The demographics of Sardinian companies in 2019–2022 and the volumes of loans and savings showed a strengthening of debt capital payments, increased collections, and a progressive improvement of the Sardinian companies’ net financial positions.

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Publication Details

Journal
Risks
Published
2024-11-28
DOI
https://doi.org/10.3390/risks12120190
Citations
2
Primary Topic
Banking stability, regulation, efficiency
Type
article
Field-Weighted Citation Impact
1.08

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article

The Role of Credit Consortia in the Financial Structure of Sardinian Companies During the SARS-CoV-2 Crisis

Marco Desogus, Stefano Zedda, Enrico Sergi
2 citations
Risks
Banking stability, regulation, efficiency
1.08
article

The Role of Credit Consortia in the Financial Structure of Sardinian Companies During the SARS-CoV-2 Crisis

Marco Desogus, Stefano Zedda, Enrico Sergi
article en
2 citations

Abstract

In this paper, we analyzed the role of credit consortia in supporting SMEs of the Italian region of Sardinia around and during the SARS-CoV-2 pandemic crisis. Credit consortia (or credit guarantee schemes) are financial companies whose institutional role is to support small firms needing bank lending who are individually weak in the bank–firm relationship. Credit consortia are particularly relevant in Italy, where they mitigate credit restrictions for SMEs by supplying guarantees to the bank, allowing for partial coverage of potential losses, providing peer-monitoring activity, and collectively negotiating more favorable interest rates and other conditions with banks. During the SARS-CoV-2 pandemic, credit consortia had a crucial role in supporting Sardinian SMEs with guarantees and obtaining government financial support. The evolution of Sardinian companies’ financial structures during the SARS-CoV-2 pandemic shows that the confidi-supported firms have low capitalization and are financially fragile yet capable of good returns. The liquidity provided by the government during the pandemic loosened these constraints, boosting the available liquidity, which translated, in short, into higher investment and higher sales. The demographics of Sardinian companies in 2019–2022 and the volumes of loans and savings showed a strengthening of debt capital payments, increased collections, and a progressive improvement of the Sardinian companies’ net financial positions.

RisksVol. 12(12)
University of Sassari (IT), University of Cagliari (IT)
Fondazione di Sardegna
Good health and well-being
Openalex Percentile: Top 19%
Banking stability, regulation, efficiency
1.08
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The Role of Credit Consortia in the Financial Structure of Sardinian Companies During the SARS-CoV-2 Crisis — Marco Desogus, Stefano Zedda, et al. · Risks (2024) | TGRS Research Map | TGRS