Minister Kelleher calls on banks to loosen credit flow to SME’s

Friday, October 23^rd

The Minister for Trade and Commerce, Billy Kelleher, T.D. has called on the banks to provide credit to the small and medium business sector as a matter of urgency.

“The banks need to end the credit famine and start releasing working capital finance to the SME (Small and Medium Enterprise) sector. Many businesses are continuing to suffer due to a lack of credit lending and any recovery is dependant on getting the banks lending again,” he said.

Minister Kelleher pointed out that the whole aim of NAMA was to recapitalise the banks so they could start lending again, and he accused the banks of not “playing ball”.

He said the banks had received government and taxpayer support at a very low rate through the State guarantee and they in turn had an obligation to support SME’s in the present economic downturn.

The Minister was addressing a meeting of the City and County Enterprise Boards in Donegal today (Friday, October 23). The Boards were set up to provide a source of support to small business and to develop indigenous enterprise potential at local level.

“Many business owners are simply not applying for credit at the moment, according to the Irish Small and Medium Enterprise Association (ISME) because they are afraid of being rejected or because the personal guarantees being sought are too high,” he explained.

Minister Kelleher said it was time for the banks to end their strict overdraft regimes and to loosen the flow of credit into the SME sector as a matter of urgency to avoid more businesses from going under and resulting in further job losses.