Bank-SME Relationships

The chapter synthesizes extant interdisciplinary literature, by putting together a combination of relationship management theories as well as banking, economics, and finance theories, and blends this with findings from an ethnographic research platform to discuss the critical variables in the development of Bank-SME relationships. In addition, the chapter considers the effect of the recent economic crisis on the Bank-SME relationship. It can be seen that few banks looked inside their relationship with their SME customers as a means of redressing the crisis’ effect and this has detrimental effects on their long-term performance. As a consequence, the chapter proposes recommendations so as to reduce the crisis negative impact. Moreover, it highlights that the new developments in the technological environment, i.e. social media, can be used to strengthen the Bank-SME relationship’s success and is especially pertinent in such times of financial duress as it can enhance the communication mode of the dyad.