At a recent meeting with reporters, Industry and Trade Minister Nihat Ergün said an SME stock market would be established under the İstanbul Stock Exchange (İMKB) and that the IPO expenses for these companies would be just 10 percent of those normally incurred on the İMKB. Ergün also said his ministry’s Small and Medium Industry Development Organization (KOSGEB) would provide financial aid for SMEs to cover for even these reduced IPO costs.
As part of the ministry’s plan, KOSGEB, the Capital Markets Board (SPK) and the İMKB are currently carrying out the necessary work to create the İMKB-subsidiary stock market. Ergün said these efforts are approaching the final phases.
Noting that one of the biggest problems SMEs face is the difficulty of finding loans that will finance new investments and accelerate growth, Ergün noted that once the project takes effect SMEs will have another source of finance. “In this way, we will have created another channel of finance for our SMEs, whose current resources are solely from their equity and bank loans,” Ergün explained.
The government has long attempted to bolster development and increase the competitive power of SMEs in Turkey. It is currently offering certain advantages for extending loans to those companies, such as earmarking specific funds and stipulating lower interest rates with longer repayment terms. For a company to be classified as an SME in Turkey and to be eligible for these incentives, it may have no more than a workforce of 250 people and an annual turnover of TL 25 million.
