Joan Burton (Dublin West, Labour)
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121. To ask the Minister for Finance his plans to help SMEs tackle the challenges they face in view of Brexit, in particular providing credit for SMEs; and if he will make a statement on the matter. [31496/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy will be aware, there are already significant Government measures to support the financing needs of SMEs and these will be available to assist SMEs deal with the effects of Brexit. These include the Supporting SMEs Online Tool, the Credit Review Office, the SBCI, the Microenterprise Loan Fund, Local Enterprise Offices and the Credit Guarantee Scheme.

Government policy is focused on ensuring that all viable SMEs have access to an appropriate supply of credit from a diverse range of bank and non-bank sources. In terms of monitoring the credit requirements for SMEs, officials from my Department collate and examine data from AIB and Bank of Ireland on a monthly basis, including data pertaining to the various sectors. Furthermore, my officials meet the banks on a quarterly basis to ensure an informed understanding of the wider SME bank lending environment which assists the development and implementation of policies aimed at ensuring SME access to finance and increased competition in the SME lending sector.

My Department also commissions biannual surveys to ascertain the demand for credit by SMEs.  This survey series, most recently conducted by Behaviour & Attitudes on behalf of my Department, is the most comprehensive survey of SME credit demand in Ireland, covering 1,500 respondents and involving over 6,000 direct telephone calls to SMEs. SMEs of all sizes trading in all sectors, excluding property development and speculative activities, are included.  The survey covers demand for credit from both bank and non-bank sources.

I would draw the Deputy's attention to the most recently published Department of Finance SME Credit Demand Survey, covering the period October 2016 to March 2017 available on www.finance.gov.ie. The results of this survey show that, when pending applications are excluded, 88% of credit applications to banks were approved or partially approved. Working capital/cash flow requirements are now provided as the main reason for applying for bank finance with 31% stating this is why they requested bank finance. When asked about sources of finance for working capital, internal funds/retained earnings were the main finance source of working capital with 78% of working capital coming from this source (up 5%).  The survey also showed that the number of businesses reporting a profit has increased for the fourth year in a row, and a higher proportion of SMEs than ever are pursuing a growth strategy.

The Government remains committed to the SME sector and sees it as the key engine of ongoing economic growth. I can assure the Deputy that my Department, working with other relevant Departments, Bodies and Agencies, is currently examining additional policy measures that may be required to assist SMEs deal with the impact of Brexit.