Written answers

Friday, 7 September 2018

Department of Finance

Small and Medium Enterprises

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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184. To ask the Minister for Finance if he has requested from the main pillar banks and other financial lenders the reason SME bank finance rejection rates have increased, especially among micro-sized companies as outlined in the SME market report from the Central Bank for the first quarter of 2018 (details supplied); and if he or the Central Bank has raised with such bodies the reason bank rejection rates for SME loans and or overdrafts here are more than twice the rates in comparator countries. [36922/18]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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The Deputy will be aware that in my role as Minister for Finance I have no direct function in the relationship between the banks and their customers. I have no statutory function in relation to the banking decisions made by individual lending institutions at any particular time; these are taken by the board and management of the relevant institution. This includes decisions in relation to rejection rates as determined by the banks.

However, the Government is concious of the important role SMEs play in our economy.  In this regard, my Department commissions biannual surveys to ascertain the demand for credit by SMEs, as well as related issues.  The SME Credit Demand Survey, October 2017 – March 2018, which was published last Monday, 27th August, shows that bank rejection rates have decreased for micro SMEs. The latest SME Credit Demand Survey report shows that refusal rates amongst micro companies have decreased to 16% in March 2018 from 21% in March 2017, while small and medium-sized businesses seeking finance have also indicated higher levels of approval rates.  The survey shows that in total, 88% of all applications for the past six months (excluding “still pending”) have been approved in full/partially, similar to March 2017.  Longitudinally, the Credit Demand Survey shows that overall rejection rates for SMEs have been reducing since the begining of the series, from 23% in March 2012 to 12% in March 2018. 

The SME Credit Demand Surveys is currently conducted by Fitzpatrick Associates in conjunction with Behaviour and Attitudes, on behalf of the Department.  It is the most comprehensive survey of SME Credit Demand in Ireland, covering over 1,500 respondents through in-depth discussions.  The survey ensures that it captures a full picture of the SME landscape in Ireland, with micro enterprises, small-sized enterprises and medium-sized enterprises accurately represented as per the percentage make-up of SMEs in Ireland. 

The SME Credit Demand Survey is available at .

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