ASSESSING THE IMPACT OF CREDIT ACCESS ON MSMES:A REVIEW OF ISSUES AND CHALLENGES IN THE CHEMICAL AND PHARMACEUTICAL SECTORS

Abstract

MSMEs are vital to growth and innovation in the chemical and pharmaceutical industry because they are crucial for economic development, while the issue of credit constraints remains significant. This paper discusses some key factors that affect credit access namely, inadequate credit from institutions, high-security interests, and inadequate knowledge on how to access as well as maintain credit among MSMEs. Using case examples, the study demonstrates how credit can unlock growth for MSMEs necessary for increasing production rates, switching to sustainable technologies, and framing production in research. Such best cases show that credit access intervention has made a positive impact on the increase in revenues, better compliance with the environmental standards and competitiveness of products in the international markets. AI, blockchain or even green financing remain trends that still hold great potential for MSMEs. Technological productivities such as credit AI-driven credit assessment models and blockchain technologies increase transparency efficiency and the accessibility while the green financing mechanisms such as the green bonds ensure that the MSMEs align to sustainability. The result highlights the importance of policy integration between policymakers, financial institutions, and industry stakeholders about the original barriers encountered in credit delivery. Thus, this research calls for policy adjustments, ICT technology utilization, and interventions to fill the credit gap and support the sustainable development and financial stability of the chemical and pharmaceutical industries. In light of the above findings, the study provides practical implications toward innovation and competitiveness of MSMEs to enhance overall economic development.