Financing Dynamics and Growth of SMEs: A Life Cycle Perspective

Yopa, Serges; Tonmo, Simplice; Ndjanyou, Laurent

مجلة التمويل والاستثمار والتنمية المستدامة
Volume 11, Numéro 1, Pages 380-396
2026-06-08

Financing Dynamics And Growth Of Smes: A Life Cycle Perspective

Authors : Yopa Serges . Tonmo Simplice . Ndjanyou Laurent .

Abstract

The problem of accessing finance has been the main reason why most SMEs die young or do not reach maturity. It has been noticed that modes of finance change as the stages of the lifecycle of SMEs change. The aim of this study was to know the impact of life cycle on modes of financing of SMEs in Cameroon. A mixed-methods research design was used, with primary data collected through a survey questionnaire and an ordinary least squares regression model. The findings show that SMEs in infancy and adolescence rely more on internal owner-manager financing and informal sources of finance, while as firms mature, they tend to use retained earnings and formal financing modes. The choice of financing mode has a positive impact on SMEs' growth in Cameroon. The study emphasizes the need for financial institutions to adapt their credit policies and services to accommodate SMEs' evolving financing needs, as well as the importance of developing a robust ecosystem to support SMEs in accessing appropriate financing at different stages of development.