Credit Demand Survey shows significant recovery in overall SME performance compared to 2020
Published on 15 February 2022
Last updated on 15 February 2022
The Department of Finance has today published the latest in its series on SME Credit Demand Surveys which covers the period April – September 2021. This survey series is currently being conducted by Behaviour and Attitudes, on behalf of the Department of Finance. 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.
While the survey is conducted biannually, for presentation purposes, the report uses year-on-year comparisons. Due to COVID-19 impacts only one survey was conducted in 2020, covering the period March to October.
Key results include:
on trading performance, 46% of SMEs reported increased turnover, 31% reported stable turnover and 24% reported a decline in turnover in the six months to September ’21
a majority of SMEs (57%) reported profit in 2021, compared to 31% in 2020 and moving closer to the 69% of SMEs that reported a profit in 2019. The number of SME’s reporting a loss was14% reported a loss in 2021, while 26% broke even
trading conditions have improved significantly, coming close to the levels recorded pre-pandemic, in September ’19
17% of SMEs applied for bank credit (-1%, 2020 and -3%, Sept ’19), with only 7% expecting to apply for credit in the following 6 months
of those SMEs that applied for credit 40% sought it for a new business venture, acquisition of assets or expansion, up from 16% in October 2020
the average loan size was €208,469, an increase from €192,185 in October 2020
9% of all SME credit applications were declined from April – September ’21, though this rate was 21% for micros
one third of all SME expenditure was accounted for by the purchase of goods and services, and a third by wages and salaries, while less than 2% of all expenditure was accounted for by interest and debt payments
39% of SMEs reported that they had no debt in September ’21
when questioned about government supports, awareness was greatest for Enterprise Ireland and Local Enterprise Office initiatives at 87% and 79% respectively
on the type of government support SMEs prefer 42% would like a longer-term investment loan scheme with loan repayment term, with some SMEs preferring credit guarantee schemes (21%) and working capital loan scheme (18%)
On the publication of the SME Credit Demand Survey, Minister for Finance Paschal Donohoe stated:
“I welcome the results of the latest SME Credit Demand Survey, April – September 2021, which gives us important insights into the continued impact that COVID-19 restrictions had on Irish SMEs through 2021, while also allowing us to perceive the significant recovery in overall SME performance compared to 2020.
“One of Government’s main concerns is to ensure that SMEs continue to have access to sufficient liquidity, and that access to credit for SMEs is maintained and I particularly welcome the high level of awareness among SMEs of the government supports available to them.
“I would like to take this opportunity to sincerely thank all those SMEs that took part in this survey. The SME Credit Demand Survey series allows us to gain critical understanding of the Irish SME landscape which allows us to develop, refine and implement policy measures to support our home-grown businesses.”