It is noted that business networks are different
from business relations with banks, although both
factors aim to create trust in credit providers or
overcome asymmetric information issues. The
main difference is the way in which information is
exchanged. In the case of bank relations, financial
statements or other relevant data provided by the
SME are the principal means for commercial
banks to evaluate a firm’s creditworthiness.
However, suppliers or credit providers in networks
are less familiar with interpreting financial
statements, so they rely mostly on a history of
payment. The causality of these two factors will be
discussed later