Isme slams banks as SME loan refusal rate increases

Small business lobby group Isme has slammed the level of bank lending to SMEs as “concerning” and “disappointing” after revealing the loan refusal rate has jumped from 23% to 28% of applications during the second quarter of the year.

Earlier this week, Central Bank figures showed a near 9% annualised fall in bank lending to SMEs in the first three months of the year, marking the 22nd consecutive quarter of downward movement. That was followed, yesterday, by Isme’s latest quarterly bank watch survey — for the second quarter — showing a significant rise in SME loan refusals and a marked decline in the number of formal applications.

Over half of SMEs surveyed said banks are making it more difficult to access finance, despite actual credit demand rising amongst smaller enterprises.