Owner Manager

1 in 10 SMEs believe NAMA will increase bank lending

15.03.2010
Just one in 10 Irish SMEs believe the Government’s National Asset Management Agency (NAMA) will make a positive difference to lending, according to a new survey by the Irish Small and Medium Enterprises Association (ISME).

“Businesses do not believe that NAMA and recapitalisation will act as a means of opening up business credit lines, contrary to the Government’s view,” said ISME CEO Mark Fielding.

“The reality is that 80pc of companies have already confirmed that the banks are making it more difficult to access credit, with 55pc of businesses recently being refused loans. This is in spite of the banks commitments, as part of the NAMA process, to increase lending capacity to SMEs by 10pc over 2008 levels. In fact, the opposite has occurred.”

Banks must honour lending commitments
ISME is now calling on the Government to force banks to honour their previous commitments to increase lending to SMEs.

“Banks will do what they have always done; look after ‘No 1’. They will use the NAMA money to shore up their balance sheets and screw the customer for every last cent they can get by ratcheting up bank charges to their already vulnerable customers, while reducing lending facilities,” Fielding claimed.

“The situation for thousands of viable SMEs is desperate, with a lack of credit threatening the survival of these companies. The Government must seek a commitment from the banks who benefit through NAMA and Government recapitalisation to immediately increase the level of lending to their viable SME customers.

“Any banks that fail to comply should automatically be refused further state assistance in their recapitalisation programme,” he added.

^{Photo - vizzzual.com}