Micro, small and medium-sized enterprises are taking an increasingly large share of Serbia’s expanding corporate credit market, accounting for almost two-thirds of the increase in business lending during the second quarter of 2026. The segment’s share of outstanding corporate loans reached 60.7% in June, while SME credit increased 12.6% year on year. The distribution of new lending places smaller businesses at the centre of the current corporate financing cycle.
The scale of SME borrowing also broadens the reach of bank credit across the domestic economy, including construction subcontractors, retailers, logistics companies, manufacturers, professional-services providers and suppliers.
Corporate Loan Approvals Increase
Banks approved RSD 436.4 billion in new corporate loans during Q2, an increase of 27.2% from the same period in 2025. Liquidity and working-capital facilities represented 58% of newly approved corporate lending, while investment loans accounted for another 28%. Micro, small and medium-sized enterprises received three-fifths of investment loans.
The allocation shows that SME financing extends beyond short-term liquidity requirements. Smaller companies are also obtaining bank funding for capital expenditure, increasing their participation in the investment side of the credit cycle. Real estate, construction and trade companies recorded some of the strongest increases in borrowing, placing SMEs directly within the broader infrastructure and consumption cycle.
Lending Standards Tighten as Demand Rises
The increase in SME borrowing is taking place alongside somewhat tighter corporate lending standards during the second quarter. Despite the tightening, demand increased for both dinar loans and foreign-currency-linked financing. Corporate credit growth therefore continued while banks applied more restrictive lending conditions. The share of corporate lending denominated in dinars also increased during the quarter. Dinarisation rose from 22.8% in March to 24.2% in June, reducing part of the corporate sector’s exposure to exchange-rate movements.
SMEs Gain Exposure to Investment Cycle
The expanding role of smaller companies connects the banking sector with a wider range of business activity. Serbia’s €19.6 billion Expo-era capital programme, expanding automotive production, recovering construction activity and rising household consumption are generating demand for suppliers and service companies. SME borrowing is consequently being directed toward businesses operating across several parts of the domestic economy, while investment lending is becoming an increasingly important component of their bank financing.
At the same time, the rapid expansion of SME credit increases the importance of underwriting standards and cash-flow management. Smaller-business loan portfolios can respond more quickly to domestic economic slowdowns or payment delays spreading through contractor and supplier chains. For banks, the current credit expansion is taking place against a low level of corporate problem loans. The corporate non-performing loan ratio stood at just 1.4%, leaving the banking sector with substantial capacity for further corporate lending.
