Fig. 1

The credit game between bank and small business. Note: B stands for bank, and E stands for small business. Distrust (N) and trust (T) are two behavioural strategies for bank, namely granting loans to small business or not. Default (D) and respect (R) are two strategies for small business, namely repaying the loans fully or not. A is the loan size, r is the lending rate, r0 notes the rate of return small business receives from the investment with the loan and r0 > r holds, G is the monetary value of collateral pledged by small business for the loan. Due to the imperfect liquidity of the collateral, its possible monetary payoff available for bank after small business takes the strategy of D is negative, i.e. G-A(1 + r) < 0