Small and medium enterprises (SMEs) considered as a key force for growth of local economies to generate employment, to create level of new business formation, and to help diversify economic activity by innovation. Therefore, countries use SME as a poverty alleviation tool to reduce poverty.
The purpose of this study is to employ the logit model to investigate the factors affecting bank loan accessibility for SMEs in Mongolia. Survey questionnaire was used to define the factors that are mostly affecting and the sample is focusing on more micro and small businesses. The study defines what kind of characterized SMEs tend to apply for bank loan and determines what factors affect loan acceptance for those SMEs have applied for bank loan.

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