Abstract
Small and medium-sized enterprises (SMEs) play a vital role in the Palestinian economy by fostering innovation and creating jobs. However, insufficient access to external finance hinders their sustainable growth. Credit infrastructure such as a Credit Risk Database (CRD) and a Credit Guarantee Scheme (CGS) are recognized as crucial tools for promoting SME development. This study employed a deductive, quantitative research approach using a developed questionnaire distributed to owners, CEOs, and CFOs of industrial SMEs in Palestine, generating 363 valid responses. Data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings reveal a significant mediating effect of access to finance in the relationship between CRD, CGS, and sustainable SME growth. Specifically, robust credit risk databases and the implementation of credit guarantee schemes indirectly foster SME growth by improving access to finance. From a policy perspective, the results highlight the need for Palestinian authorities to institutionalize CRD and expand CGS frameworks as key components of national financial infrastructure. A credit risk database that accurately assesses SME creditworthiness can reduce information asymmetries and lending risks, while CGS mitigates financial risk for lenders, enhancing external funding opportunities and reinforcing resilience strategies, private sector growth, and job creation.