What Prevents Firms from Access to Finance? A Case Study of OIC Countries

In this paper, micro survey data from a sample of over 13,000 firms from 30 OIC countries is used to address two primary questions: (a) what are the firmlevel and country-specific predictors of financing obstacles in the OIC countries, and (b) how similar are those determinants across the least developed countries (LDCs) and developing OIC countries. It is found that the number and firm-specific characteristics that predict financing obstacles are more diverse in the LDCs when compared with the developing OIC countries. Age, size, sectoral origin, export status and ownership status of firms appear to be the most significant determinants of access to finance for firms in LDCswhile only a few of these determinants are found to be statistically significant for developing OIC countries when compared to LDCs. The results also suggest that country-level indicators which measure financial infrastructure and economic development are strongly associated with obstacles to financing for firms in both groups of countries.