Liquidity of Bosnia and Herzegovina Institutions and its Influence on the Scope of Commercial Transactions with Small and Medium Sized Enterprises

Small and medium sized enterprises (SMEs) take up over 98% of the structure of economies and are consequently the biggest creators of new jobs, innovations, economic activity, and greater social inclusion in the European Union. One of the biggest issues that SMEs face is collection of accounts receivable. Late payments in commercial transactions are made not only by private but also public sector, and that public sector entities, i.e. state institutions, are even larger generators of illiquidity compared to private companies. SMEs in BiH have certain, although insufficient, legal solutions available in combating late payment in commercial transactions. However, the fear of losing business partners overcomes their willingness to exercise their rights as creditors.