Credit Risk and Financing of Distressed Companies in Morocco: Issues of Early Detection and Bank Rationing (International Journal Of Applied Management And Economics)

Summary

• Morocco recorded 380 230 active legal entity firms in 2024, with micro, small, and medium enterprises accounting for 98,5 % of the total.p.4
• Bank debt held by non-financial enterprises reached approximately 657 billion dirhams in 2025, representing 39 % of GDP.p.10
• Non-performing loans of non-financial companies stood at around 70,1 billion dirhams at end-2024, corresponding to a risk rate of 11,1 %.p.4
• Moroccan commercial banks maintained an average solvency ratio of 16,2 % at end-2024 and 16,1 % at end-2025, alongside a Tier 1 capital ratio of 13,5 %.p.4
• Circular No. 1/W/2025 introduces a sensitive claims category requiring a mandatory minimum provisioning floor of 10 %.p.14
• While MSMEs accounted for 98,5 % of bank business borrowers in 2024, they represented only 41,2 % of total outstanding credit.p.10

Key insights

1. Microenterprises represented 86,6 % of active legal entity companies in Morocco in 2024, highlighting extreme vulnerability to cash flow constraints.p.9
2. Client payment delays in the private sector reached an average of 125 days of turnover in 2023, rising to around 130 days for microenterprises.p.9
3. During the fourth quarter of 2024, 32 % of surveyed industrial firms reported a difficult cash situation, while 16 % reported difficult access to bank financing.p.9
4. Equipment loans made up 47 % of non-financial enterprise bank debt in 2025, while cash loans represented 35 %.p.10
5. Circular No. 1/W/2025 establishes progressive minimum provisioning rates of 10 % for sensitive loans, 20 % for pre-doubtful loans, 50 % for doubtful loans, and 100 % for compromised loans.p.14