| 6°C Dublin

Demand for loans from SMEs beginning to increase – survey

DEMAND for credit from small and medium enterprises (SMEs) remains low but is beginning to slowly increase, a new survey has found.

The latest Department of Finance backed report into the state of the market for lending to SMEs found that around 76pc of credit applications are being approved, but less than 40pc of companies are actually applying for a loan or overdraft.

The bi-annual survey, which was carried out by Red C, found that demand increased slightly during the six months up to September, with 39pc of firms trying to access credit, compared to 38pc during the prior period. That growth was driven largely by the micro enterprise sector, with saw demand jump to 36pc of business from 30pc six months earlier.

Finance minister Michael Noon welcomed the report, which he described as “comprehensive”.

“The SME sector is a key driver of growth and jobs in the Irish economy. While there is no doubt the operating environment is challenging, stability is returning and I hope this will give confidence to SME owners and managers to invest in their businesses,” he claimed.