A Study on Edge Strategy between Banks and Small & Medium Enterprises (SMEs)

• Main Authors: FAN, YANG-KUEI, 范揚桂
• Other Authors: HO, LI-HSING
• Format: Others
• Language: zh-TW
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/a9ma8a

碩士 === 中華大學 === 科技管理學系 === 106 === The financial market in Taiwan is one of perfect competition and over banking, where competition is highly competitive. In contrast to large enterprises that greatly reduce bank credit risks by keeping financial affairs public and transparent, operating profits open to the public, and credit rating mechanisms highly discriminative, the competition in loan offering can escalate into price competitions, resulting in low loan-deposit interest rate spreads. In recent years, banks have turned their corporate banking operations to small and medium enterprises (SMEs) that have greater interest rate spreads. This seems to form a new round of competition. How do banks succeed with mature developments in financial products? Do the banks’ financial products really meet the SMEs’ demands？ How do SMEs choose financing banks ? This study investigated how SMEs perceive bank’s financial services from their perspectives. In-depth interviews were conducted to understand the key decision-making factors in the SMEs’ choice of financing banks. In addition to core factors such as capital-based moneymaking, emphasis on interest rates, and loan percentage, this study found a total of 11 important factors that SMEs also consider in deciding which financing banks to work with. These factors include good services, high levels of motivation, cooperative operations, stable credit policies, transparent financing conditions, powerful scale of bank constitution, social constraints from long-term interactions, trust in corporations brought about by managers and leading teams, direct proportions between branch managers’ high level of trust and loyalty at the headquarter, reduced corporate finance operating costs, high levels of friendliness to the company, clear communications about business strengths, distinguishable business operations, and reduction in financial product sales. Based on the SMEs’ different attributes, banks are expected to surely and effectively review their own edge strategies. Through price differentiation, the banks’ core credit products are expected to satisfy consumer demands with different levels of risks, as well as innovate the financing structures and flexibly execute financing operations. Banks can use abundant product lines to provide one-step financial services, or expand related operations, increase financing operations, and develop added-value services. Alternatively, good bank credibility and efficient, credible human resources can be used to reciprocally establish loyal bank clerks and client relationship management. The advantages that accumulate over time can increase efficacy by removing previous barriers, discover client’s unsatisfied potential demands, increase competitiveness, obtain a grasp over business opportunities, and systematically manage SME client relationships in the long run. This serves as a reference for creating greater profits at minimum risks without increasing innovation costs.