Even if the nexus between the two concepts still requires further theoretical and empirical study, public policy is confronted – already here and now – with real, practical challenges in responding to developments in the financial system which affect the complex, multi-faceted, and time-varying interrelation between financial stability and efficiency.
Going forward, the banking industry need to examine and develop innovations to assist the development of SMEs. These innovation could extend the scope of financing to SMEs and at the same time reduce the risks of extending credits to the sector.