Philip Lane: New lenders to lower SME loans in time

New entrants into Irish banking will play a part in driving down the borrowing costs for Irish firms, but it will take time, Central Bank governor Philip Lane has said.

The Central Bank’s own research shows indigenous Irish SMEs pay the highest interest rates to borrow money in the eurozone, and are charged almost double the rates that small firms in Austria are charged by their lenders.

Many analysts say this means Irish firms effectively pay a hidden tax to do business here compared with their counterparts across the single currency area.