ISSN: 2222-6990
Open access
Oman has grappled with economic turbulence, thrusting the financial struggles of small businesses into the forefront of governmental concerns. In response, the Omani government has introduced several policies aimed at bolstering Small and Medium-sized Enterprises (SMEs) to ensure their sustained contribution to economic growth. Despite endeavors to fortify SMEs, they continue to confront formidable challenges, resulting in a notable rate of failures. A significant number still find themselves in need of crucial financial support to navigate the increasingly competitive global market. Securing these funds, however, presents a formidable obstacle, as the processes involved are beset by numerous hurdles. This study sought to comprehensively investigate the financial challenges encountered by SMEs in Oman and scrutinize the impediments inherent in prevailing policies and procedures. Data was gathered through research questionnaires distributed to 326 SMEs in Oman. Employing Likert scale questionnaires for the quantitative aspect and open-ended questions for the qualitative component, the collected data underwent rigorous analysis using statistical tools. The findings underscored the multifaceted challenges facing SMEs in Oman, encompassing both external and internal factors. Specific challenges identified included the indifference of commercial banks, exorbitant borrowing costs, inadequate financial collateral support demanded by financial institutions, a dearth of modern accounting systems, and limited awareness about the intricacies of accessing financial assistance. The exacerbated financial challenges experienced by SME owners were found to moderately impact overall SME performance, potentially stemming from economic downturns, limited job opportunities, and delayed international market entry. Addressing these challenges necessitates the formulation of specific operational strategies by SMEs, coupled with robust support at the national level. It is imperative for commercial banks and financial institutions to accord special attention to SMEs, recognizing their pivotal role in the economic landscape. Through collaborative efforts, SMEs can overcome these obstacles and thrive in a dynamic business environment.
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(Musallami & Balushi, 2024)
Musallami, N. H. S. AL, & Balushi, I. S. AL. (2024). Study on SME Financing and Their Impact on The Firms Financial Performance in Oman. International Journal of Academic Research in Business and Social Sciences, 14(1), 491–508.
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