As a result, securitisation markets have been stigmatised in public perception. However, with appropriate structure and regulation, securitisation may have a positive long-term social value. Securitisation markets complement other long-term wholesale funding sources for the real economy. This allows enterprises to diversify their sources of funding.
By gaining indirect access to investors on the capital market, small and medium-sized enterprises can particularly benefit from this. Securitisation can also open up space on banks’ balance sheets, thus creating leeway for further lending to the private sector. A market for prudently designed asset-backed securities may potentially improve the efficiency of resource allocation in the economy and ensure better risk sharing.