World’s Best SME Banks 2023

Global Finance presents its second annual listing of the best global, regional and national banks that serve SMEs.

Small and midsize enterprises (SMEs) face a rough 2023 as supply chains remain disrupted and inflation returns after more than a decade’s absence. According to the October 2022 World Economic Outlook from the International Monetary Fund (IMF), the world’s real GDP for 2023 is projected to be 2.7%, with advanced economies projected to slow to 1.1% while developing economies would maintain a 3.7% growth rate.

The IMF attributes much of the “sharper than expected slowdown” to higher inflation, a cost-of-living crisis, lingering Covid-19 effects and “tightening financial conditions in most regions.” On the bright side, the IMF estimates that the global inflation rate will fall to 6.4% in the coming year and retreat to 4.1% in 2024.

Nonetheless, SMEs have one hurdle their larger competitors do not have, and it will not go away: When it comes to banking, SMEs are neither fish nor fowl.

The estimated 30 million registered SMEs worldwide, according to the World Bank’s SME Finance Forum, land somewhere between retail banking and corporate banking, depending on the size of their business. Falling into such a no man’s land of services and funding is odd, considering that the business segment accounts for 90% of companies, half of global GDP and two-thirds of jobs worldwide, according to the Forum.

Nonetheless, micro, small, and midsize enterprises (MSMEs) in developing countries, which represent 41% of unfunded MSMEs, have a funding gap of roughly $4.5 trillion, or 30% more than the current level of $3.9 trillion funded MSMEs. Female-owned businesses, representing 23% of MSMEs, account for 32% of the finance gap.

Funding is not a concern limited to those in developing and emerging markets. A recent study conducted by the European Central Bank noted that 20% of European SMEs cite access to capital as their most urgent problem.

Finding the Right Match

For many banks, SME clients do not provide enough of a return for the high-touch relationship that SMEs seek. A study of more than 500 German SMEs by the consultancy McKinsey & Company found that good customer service was the leading concern for respondents (36%) when selecting an SME banking partner, followed by the convenience of branch locations (34%) and enhanced online offerings (26%).

However, “there is no one-size-fits-all approach that banks can apply to these clients, given the variety of needs, business types and decision-makers,” Mohcine Ouass and Nicolas Reuttner, partners at McKinsey, wrote in the article, A Digital Approach to SME Banking.

They further note that the top-performing banks in Western Europe that cater to SMEs generate more than 30% more revenue per SME client than average banks, through less capital-intensive cross-sell products yielding significantly higher capital efficiency. The leading banks also reduced costs by moving SME client onboarding online and reducing the time to accomplish the task by up to 85%.

These leading banks should not rest on their laurels, as well-funded fintechs and other non-bank firms look to capture a portion of the SME market using the same strategies but without the concerns of legacy infrastructure.

Methodology: Behind the Rankings

The editors of Global Finance, with input from industry analysts, corporate executives and technology experts, selected the winners for the World’s Best SME Banks 2023 based on objective and subjective factors. Editors consulted entries submitted by the banks and the results of independent research. Entries were not required.

Judges considered performance from April 1, 2021, to March 31, 2022. Global Finance then applied a proprietary algorithm to shorten the list of contenders and arrive at a numerical score of up to 100. The algorithm weights a range of criteria for relative importance, including knowledge of SME markets and their needs, breadth of products and services, market standing and innovation.

Once the judges narrowed the field, they examined the final criteria, including the scope of global coverage, size and experience of staff, customer service, risk management, range of products and services, execution skills and use of technology. In the case of a tie, the judges lean toward local providers rather than global institutions. The panel also tends to favor private-sector banks over government-owned institutions. The winners are those banks and providers that best serve the specialized needs of SMEs.


Brazil’s BTG Pactual Empresas ends 2022 with a triple victory as the Best SME Bank in the World as well as the Best SME Bank in Brazil and in Latin America. The electronic bank balances the innovation and agility of a startup with the offerings, capabilities and balance sheet of a well-established brick-and-mortar bank.

Over most of 2021 and the first quarter of 2022, BTG Pactual Empresas grew its SME portfolio by 82% year-on-year to approximately 18.9 billion Brazilian reals (about $3.6 billion) while reducing its non-performing loan ratio by 1.11 percentage points to 0.11%.

While SMEs represent 90% of the legally constituted companies in Brazil as well as 30% of the nation’s GDP and 41% of total payrolls, the bank has carved out a 6.6% market share by the end of the first quarter this year. It added 71,000 platform users, 65 billion reals in operations and 65,000 new SME clients while integrating 1,600 new partners into its digital banking ecosystem.

This dramatic growth can be attributed to BTG Pactual Empresas’ launch of its fully online onboarding process; multichannel customer support via WhatsApp chat, email and toll-free calling; as well as payroll, federal tax accounting and other services. These services build on the bank’s existing mobile and web access capabilities, instant transfers via the PIX instant payment system, open banking connections, single-sign-on multibusiness and multiuser accounts, payment services, online invoicing, collection management, budgeting features, digital receipts and foreign currency exchange.

Looking to expand its reach further, the bank has published an open finance application programming interface as well as connections with Google’s productivity and collaboration platform, Google Workspace, which promise future synergies.