Minister Donohoe welcomes latest result of SME Credit Demand Survey

Minister Donohoe welcomes latest result of SME Credit Demand Survey

Survey shows demand for credit is low and that the number of SME businesses reporting a profit has increased for the sixth year in a row

The Department of Finance has today published the latest in its series on SME Credit Demand Surveys which covers the six month period April to October 2017.  This survey series, currently being conducted by Fitzpatrick Associates, together with Behaviour and Attitudes, on behalf of the Department of Finance, is the most comprehensive survey of SME Credit Demand in Ireland, covering over 1,500 respondents through an in-depth discussion. The survey covers all the various sizes of SMEs be they micro enterprises, small-sized enterprises or medium-sized enterprises.

Some of the key findings of the survey include:

  • Favourable trading conditions remain for SMEs with 86% of SMEs reporting a stable/increased trading performance and 59% of SMEs reporting a profit over the six months from April to October 2017.
  • During the period of this survey (April to October 2017) some 23% of SMEs requested credit and within that 85% of completed credit applications were approved or partially approved.
  • Of those who did not request credit, 88% of SMEs stated that they did not seek credit because they did not need it.
  • The most significant increase in the type of credit requested by SMEs is for new loans (up from 28% in 2016 to 34% in 2017.
  • Business sentiment with regard to the next six months remains in positive territory and confidence has increased from 48% of SMEs in Sept. ’16 (expecting the business climate to improve in the next six months) to 57% in Sept. ’17. This is a welcome improvement given uncertainty cause by Brexit.

On publishing the results of this most recent survey, the Minister for Finance and Public Expenditure & Reform, Paschal Donohoe T.D. stated:

‘The results of this latest SME Credit Demand Survey show that demand for credit continues to remain low across SMEs of all sizes.  However, encouragingly, the number of businesses reporting a profit has continued to increase and this optimistic business performance can impact positively on credit demand as companies look towards expanding or consolidating their business’.

“I would like to express my sincere thanks to each and every one of the SMEs who took the time to participate in the survey.  The information gathered allows us to update our understanding of the SME credit and lending landscape and is truly an invaluable resource that allows us to develop, refine and implement policy measures to support our indigenous businesses.

“As evidenced in the Programme for a Partnership Government, we remain committed to ensuring that all viable businesses operating in Ireland should have the opportunity to access sufficient finance to meet their enterprise needs in a manner that supports growth and employment in the economy.”