Banking services damned in two surveys

BANKS are not open for business and a lack of credit is crippling the country’s small firms. sector.

These are among the findings of two surveys conducted among those working in the small business.

Small business group ISME said almost two thirds of its members have been refused credit by banks over the last few months.

A separate survey among members of the Institute of Certified Public Accountants in Ireland (CPA) showed 70% believe banks are not open for business.

Almost nine out of 10 said they are seeing viable businesses getting into trading difficulties because of a lack of credit from their banks, according to the CPA.

The ISME survey, conducted among 400 small business owners, found four out of fivebelieve banks are making it more difficult for small firms to access finance.

ISME chief executive Mark Fielding said: “Contrary to public statements issued by the banks, there is clear evidence that they are making it as difficult as possible for business customers to access badly needed credit, with serious ramifications for those concerned.

“Sound profitable businesses, which require credit facilities, are among the companies being refused.”

Mr Fielding said that should the situation be allowed to continue,business activity will deteriorate, creating a vicious cycle of funding deficiencies leading to company closures and job losses.

President of the CPA, John White, said: “No bank is taking on business from another bank at present so there is no competition when it comes to negotiating better credit terms.”

The Irish Banking Federation (IBF) said it believes banks are still open for business and willing to lend to viable, sustainable businesses.

Figures from Trade Credit Brokers show overdue accounts are up around 400% on last year.

Una Nesdale of Trade Credit Brokers said: “Significant drops in working capital and the banks reigning in of credit facilities... have hit Irish business hard.”