Determinants of SME credit worthiness under Basel rules: the value of credit history information


  • Francesco Dainelli
  • Francesco Giunta
  • Fabrizio Cipollini



Basel accord, Small business financing, credit historical data, rating


The Basel III Accord has reportedly had an impact on SME financing. In this paper, we aim to highlight the determinants of SME credit worthiness. We use credit history in addition to financial ratios and “hybrid” indicators that have been built by mixing credit history with financial statement data. We develop a failure prediction logit model on 187 Italian SMEs. The use of short-term credit lines is the most important variable. Contrary to common understanding, capitalization levels do not affect ratings. Lastly, credit worthiness is sensitive to sale profitability.


JEL Codes: M21, E51, G24


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How to Cite

Dainelli, F., Giunta, F., & Cipollini, F. (2013). Determinants of SME credit worthiness under Basel rules: the value of credit history information. PSL Quarterly Review, 66(264).