A new survey shows that 20% of SMEs applied for bank finance in 2024, an increase from 18% in 2023.
The Department of Finance’s latest SME Credit Demand Survey also shows that of those companies seeking finance, 37% cited working capital/cash flow requirements as the main reason.
The survey showed that the average value of a credit application for new finance was €260,059 last year, up from €185,857 in 2023.
Meanwhile, just 9% of SMEs applied for government financial support or other non-bank finance – no change year on year from 2023.
Today’s survey also reveals that 74% of SMEs who did not apply for credit said their sufficient internal funds was the reason for not seeking credit.
The Department of Finance said that 44% of all businesses surveyed reported increased turnover for 2024, a decrease from the 52% in 2023.
36% reported no change in turnover, while 20% reporting a decrease in turnover similar to year 2023.
It noted that the Hotels & Restaurants sector reported one of the lowest net turnovers, with a notable decline seen in trading conditions from 2023 to 2024.
They survey also found that the average Irish SME had outstanding debt in 2024 of just under €444,000 up from €369,000 in 2023.
Average outstanding debt ranged from €53,000 among micro businesses to €1.45m among medium sized companies.
54% of all SME outstanding debt was to retail banks, with the balance owed to non-bank bodies.
Minister for Finance Paschal Donohoe said the SME Credit Demand Survey provides a critical understanding of the Irish SME landscape.
“This in turn enables, not only Government bodies, but numerous other businesses and stakeholders, to develop, refine and implement policy measures to support SMEs that are critical to Ireland’s economic performance and a vital source of employment across the country,” Mr Donohoe said.
Today’s survey has been conducted by Ipsos B&A, 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.
