Impact of credit institution concentration on the availability of financing for SMEs in Spain

Identifier:  TFG:9645

Handle: https://hdl.handle.net/20.500.11797/TFG9645

Authors:  Arango Cortés, Jordi

Abstract:
Small and medium-sized enterprises are the fundamental pillar of the Spanish business landscape, yet their access to credit depends almost entirely on banks. This makes them particularly vulnerable to a phenomenon that has reshaped the Spanish financial system since the 2008 crisis: the concentration of credit institutions. Merger after merger, and through acquisitions and dissolutions of entities, the market has shifted from hundreds of competing institutions to a handful of large groups dominating the landscape. But how does this structural change affect SMEs' ability to secure financing? To answer this question, the paper estimates a panel data model for all 17 autonomous communities over the period 2010–2024, measuring regional concentration through the Herfindahl-Hirschman Index and approximating credit access via the cost of financing and the debt ratio. The findings reveal whether the concentration of credit institutions acts as a barrier or a catalyst for SME financing in Spain.