How Far Can Insurance Companies Invest in SMEs Debt Financing?

Under the combined effects of a decline in rates and the political desire to help finance the economy within a regulatory environment that is restrictive for banks, since 2012 the law has authorized insurance companies, under certain conditions, to allocate up to 5% of their clients’ savings to the private loan market and in this way to help finance small and mid-size companies. After describing the features of the financing mechanism with non-bank loans, the goal of this article is to use economic theory to propose a debate on the advantages and disadvantages of such a mechanism.