Harwood, AlisonKonidaris, Tanya2015-02-032015-02-032015-01https://hdl.handle.net/10986/21381In recent years, many emerging market countries have developed or are in the process of developing SME Exchanges to provide financing to SMEs, but few have succeeded. This paper aims to help stock exchanges and policy makers think through the key questions to be addressed to determine if, when, how and for whom to develop an SME Exchange in emerging market countries. It takes stock of some of the actions that exchanges can take to reduce issuance costs, in time and money for SMEs, without compromising the prudential needs of investors. The paper draws on the experience of seven SME Exchanges and the World Federation of Exchanges that participated in a workshop organized and led by the WBG to discuss these and other questions. It does not recommend a specific model to follow and does not address specific context issues, however the analysis suggests approaches that are widespread and/or could be beneficial to consider such as (1) focus on SMEs with a sizeable growth rate, (2) have the SME exchange legally related to the main board, (3) do not reduce disclosure content to reduce costs, (4) allow private placements, (5) have well regulated advisors to vet issuers and provide comfort to investors about the quality of the issue, (6) have outreach, public awareness campaign and training for SMEs, (7) consider tax incentives for investors. The report is the first in a series on this topic, and subsequent reports will address and expand on related and broader issues.en-USCC BY 3.0 IGOACCESS TO CAPITALACCESS TO INFORMATIONACCOUNTINGADVANCED ECONOMIESALTERNATIVE INVESTMENTASSET CLASSESASSET VALUEAUCTIONAUCTIONSAUDIT COMMITTEEBALANCE SHEETBANK FINANCINGBANK LENDINGBANK LOANSBANKRUPTCIESBIDBLUE CHIPBROKERBROKERAGEBROKERSCAPACITY BUILDINGCAPITAL GAINSCAPITAL INVESTMENTCAPITAL MARKETCAPITAL MARKET FUNDINGCAPITAL MARKETSCAPITAL MARKETS REGULATORCAPITAL MARKETS REGULATORSCAPITAL RAISINGCAPITAL REQUIREMENTCASH FLOWSCHECKSCOLLATERALCOLLATERAL REQUIREMENTSCONFLICT OF INTERESTCONFLICTS OF INTERESTCONSUMER GOODSCORPORATE FINANCECORPORATE GOVERNANCECOST STRUCTURECOST STRUCTURESCREDIBILITYCREDIT RATINGCREDIT WORTHINESSCUSTODYDEBTDERIVATIVEDERIVATIVESDERIVATIVES MARKETDEVELOPING COUNTRIESDEVELOPMENT BANKDEVELOPMENT FINANCEDISCLOSURE DOCUMENTSDISCLOSURE REQUIREMENTSDISCLOSURE STANDARDSDOMESTIC INSTITUTIONAL INVESTORSDUE DILIGENCEECONOMIC DEVELOPMENTEMERGING MARKETEMERGING MARKET COUNTRIESEMERGING MARKET COUNTRYEMERGING MARKET ECONOMIESENTRY REQUIREMENTSEQUITIESEQUITY CAPITALEQUITY FINANCINGEQUITY ISSUESEQUITY MARKETEQUITY MARKETSEQUITY SECURITYEQUITY VALUATIONEXCHANGE BOARDEXCHANGE COMMISSIONFINANCE CORPORATIONFINANCIAL CRISISFINANCIAL INFORMATIONFINANCIAL INSTITUTIONSFINANCIAL INSTRUMENTSFINANCIAL SERVICESFINANCIAL STATEMENTFINANCIAL STATEMENTSFINANCIAL SUPPORTFOREIGN EXCHANGEFOREIGN EXCHANGE MARKETSFOREIGN INVESTORSFUND MANAGERSGLOBAL ECONOMYGOOD GOVERNANCEGOVERNMENT BONDSGOVERNMENT POLICYGOVERNMENT SUPPORTGROSS DOMESTIC PRODUCTGROWTH RATEHOLDINGHOLDINGSILLIQUIDITYINCOMEINCOME TAXINDEBTEDNESSINDIVIDUAL INVESTORSINFORMATION ASYMMETRYINFORMATION DISCLOSUREINFORMATION TECHNOLOGYINFORMATIONAL ASYMMETRIESINITIAL PUBLIC OFFERINGSINSIDER TRADINGINSTITUTIONAL CAPACITYINSTITUTIONAL INVESTMENTINSTITUTIONAL INVESTORINSTITUTIONAL INVESTORSINTEREST RATESINTERNATIONAL BANKINTERNATIONAL FINANCEINTERNATIONAL FINANCIAL MARKETSINTERNATIONAL MARKETINVESTINGINVESTMENT BANKINGINVESTMENT BANKSINVESTMENT MARKETINVESTOR BASEINVESTOR BASESINVESTOR CONFIDENCEINVESTOR DEMANDINVESTOR PROTECTIONIPOISSUANCEJOB CREATIONJURISDICTIONSLIABILITYLIQUIDITY RATIOLOCAL INVESTORLOCAL INVESTORSLOW-INCOME COUNTRIESMARKET CAPMARKET CAPITALIZATIONMARKET DEVELOPMENTMARKET EFFICIENCYMARKET INTERMEDIARIESMARKET MAKERMARKET MAKERSMARKET MAKINGMARKET PARTICIPANTSMARKET RISKMARKET SIZEMARKET SPECIALISTMARKET VALUATIONSMINORITY INVESTORMINORITY SHAREHOLDERMINORITY SHAREHOLDER RIGHTSMINORITY SHAREHOLDERSNATIONAL SECURITIESNATIONAL STOCK EXCHANGESPORTFOLIOPOTENTIAL INVESTORSPRIMARY MARKETPRIVATE EQUITYPRIVATE INVESTMENTSPRIVATE PLACEMENTPRIVATE PLACEMENTSPUBLIC OFFERINGPUBLIC UTILITIESREAL ESTATEREGISTRATION FEEREGULATORY AUTHORITYREGULATORY FRAMEWORKREGULATORY FRAMEWORKSREPUTATIONRESERVERESERVE BANKRETAIL INVESTORRETAIL INVESTORSRETURNRETURNSRISK PROFILESAVINGSSAVINGS ACCOUNTSSECONDARY MARKETSECONDARY MARKET LIQUIDITYSECONDARY OFFERINGSSECURITIESSECURITIES EXCHANGESECURITIES MARKETSECURITIES REGULATORSSECURITIES TRANSACTIONSETTLEMENTSETTLEMENT INFRASTRUCTURESHAREHOLDERSHAREHOLDER STRUCTURESHAREHOLDERSSMALL BUSINESSSTAMP DUTIESSTAMP DUTYSTARTUPSTARTUPSSTOCK EXCHANGESTOCK EXCHANGESSTOCK MARKETSSTOCKSSUPERVISORY AUTHORITYTAXTAX CONCESSIONTAX EXEMPTIONTAX INCENTIVETAX INCENTIVESTAX INCENTIVES FOR INVESTORSTELECOMMUNICATIONSTRADESTRADINGTRADING PLATFORMTRADING PLATFORMSTRADING SYSTEMTRANSACTIONTRANSPARENCYTURNOVERTYPE OF INVESTORVALUATIONSVENTURE CAPITAL10.1596/1813-9450-7160