Bank financing is an important external source of financing for SMEs. However, banks often considered SMEs as riskier than large enterprises and therefore use various tools to mitigate their risks in SME lending / financing such as imposing collateral requirement, higher pricing and credit rationing. This may limit access to finance for the SMEs. By understanding SME default risk better, banks may reduce or eliminate the collateral requirement, lower the pricing or avoid credit rationing thus improving access to finance for the SMEs. Studies have considered various risk factors and their impact on default. However, none, to the best of my knowledge has considered religion as a risk factor. Religion has been shown to influence individual decision-making that affects economic outcomes. Thus, this thesis postulates that religion may have an effect on SME default risk too. The thesis examines religion from four perspectives; as a loan characteristics i.e. Islamic financing and conventional loan, as a firm characteristic i.e. Muslim and non-Muslim owned SME, as a brand and religiosity ...