ABSTRACT The SMEs (small and medium-sized enterprises) play important role in the economy. However, the financing problem is a big difficulty, which has plagued the SMEs’ development. Information asymmetry is the main reason for the SMEs’ gaining funds so hard. The information asymmetry between banks and enterprises is that banks do not know the operating conditions and credit situation of SMEs. Then, to some extent, the banks are reluctant to support credit for businesses under the circumstance of lacking appropriate information, resulting in a “credit crunch” behavior. Therefore, the main measures of solving SMEs’ financing difficulty are to overcome the information asymmetry in the process of SME financing by establishing effective information mechanisms, the credibility and restraint mechanisms, strengthening the construction of credit rating agencies, and promoting the mutual exchange of information.
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