Small and medium-sized businesses in Ireland are being charged higher interest rates for business loans than our European cousins. That’s according to the latest report from The Central Bank of Ireland. The figures show that in the six months to September 2015 show an average interest rate of 5.7% for business loans of up €300,000.
The Central Bank’s findings show that Bank finance application rates have been declining since 2012. Loan application rates, which have been steady since 2013, are low by European levels.
The report also states that 39% of Irish SMEs consider access to credit a “high concern”. Perceptions of banks willingness to lend have slightly increased. Although Bank rejection rates have declined slightly since the last report (currently 15%, down from 16%), this rate is still above euro area averages (8-9%)
Statistics reveal that SME default rates are declining. Currently, 19% of loans and 31% of total outstanding balance are/is in default (down from 26% and 41% respectively in 2013).
As in recent years default rates remain highest in the Construction and Hotel/Restaurant sectors.
This report was first featured in the Irish Examiner. Read it here. The full report can be found here.
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