Dept of finance, SME credit demand survey
The independent survey on demand for bank credit by SME’s in Ireland was published this month covering the period October 2013 to March 2013. This survey was conducted by RED C and was the six wave of this survey, each covering six month periods.
This survey is the most comprehensive survey of SME Credit Demand in Ireland covering over 1,500 respondents and over 5,000 direct calls to SME’s.
The overview of findings are shown below, with the full report available for download:
The results from this period’s Credit Demand Survey show a further improvement in trading conditions among Irish SMEs but to a lesser degree than the previous survey in September 2013. While many SMEs reports increased sales, this does not fully translate into increased profitability. As a consequence of this, SMEs are more focused on stabilising current business rather than exploring growth opportunities which in turn limits staffing and investment levels.
We see a slight decrease in credit demand overall as improved trading conditions reduces the need for working capital finance while the cautious outlook by many SMEs limit the need for capital for growth and expansion. A further uplift in business sentiment combined with experiencing concrete benefits of the upturn is required for SMEs to increase their demand for bank finance.
The overall approval rate remains relatively unchanged compared to September 2013 but we see improvements for the turnaround time, indicating that banks have improved at providing SMEs with a quicker response to their applications.
The full report is available for download below:
adobeDept of Finance SME Credit Demand Survey Report – Oct 2013 -Mar 2014