The crowdlending market has emerged as a significant alternative financing mechanism for small and medium enterprises (SMEs). The European Union works towards the unification of crowdfunding markets. This paper aims to review future research directions to support crowdlending as a financial alternative for SMEs transitioning to a sustainable economy. The methods of this literature review include comparative analysis and thematic synthesis to identify emerging trends and research gaps. We delve into relevant research themes regarding the role crowdlending plays in supporting SMEs in the transition to a low-carbon economy, including first, the diversity in investor profiles and motivations across EU countries; second, the role of crowdlending platforms and ventures in signaling project quality; and third, the current state of impact reporting and sustainability metrics.
Our review shows a wide diversity in theoretical approaches highlighting the need for a more unified framework to facilitate comparisons across studies. This includes considering the various motives for investors to contribute to campaigns and defining the success of a campaign or platform. For the moment crowdlending platforms lag considerably on systematic impact reporting and sustainability metrics compared to traditional finance sources like banks. Novel aspects of our study include the emphasis on the need for cross-country comparative studies and harmonizing research practices across Europe. Finally, we underscore the importance for joint research on integrated impact metrics for crowdlending platforms as prevalent signals to maintain investor’s confidence and support SMEs in their transition towards (ESG) sustainability.
