Mazars reported that the banks’ refusal rate of 14pc in the two reports may not be accurate due to “limitations” within the banks and

that a rate of 18pc “may be more representative”.

Commenting on the findings of the second independent “Review of Lending to SMEs”, conducted by Mazars, the Director of the Small

Firms Association, Patricia Callan, said that “the report clearly shows that SMEs now face an even more challenging environment in

accessing credit than was the case when the first report was released in July 2009.”

 

“The ongoing monitoring of bank lending to SMEs is important”, Callan stated “and had been called for by the Small Firms Association

and was included as part of the government’s recapitalization plan announced in February 2009”. However Callan noted that “little had been

done to implement the recommendations of the first Mazars report, which is part of the reason why declines to SME credit applications has

actually increased in the second monitoring report from 24pc to 28pc”.

“When a small business fails, it is not because it runs out of customers, ideas or products. It simply runs out of money. With one in four small

businesses in Ireland not getting enough credit, we have a very serious problem, with potentially 62,500 small business closures and 200,000

jobs lost as a result.”

 

The Report clearly shows the serious pressure small businesses are facing in order to survive with the number of SME loans “on watch” or “impaired”

at the end of September 2009 rising to 32pc from 22pc in February. “This is a dramatic deterioration of 10pc in 7 months and indicators are that it

has only worsened since then,” said Callan.