Purpose:
Small and medium-sized entities (SMEs) operating in the alternative financing sector are typically
heterogenous in nature making them differ greatly from traditional banks. Where traditional banks must
comply with strict banking regulations, developing uniform regulations for the alternative financing sector
remains a challenge. This paper examines the current challenges and solutions from a sociological and
institutional perspective in developing standards for SMEs operating in the alternative financing sector in
the Netherlands. Adopting minimum quality standards should lead to increased transparency and public
trust in the non-banking sector.
