Dáil Éireann Debate, Wednesday - 1 April 2015
63. Deputy Bernard J. Durkan asked the Minister for Finance the degree to which Government policy towards assisting small and medium sized enterprises, by way of enhanced lending for working capital or other purposes, has been successful to date; and if he will make a statement on the matter. [13600/15]
View answerThis Government recognises that small businesses play a central role in the sustainable recovery of the Irish economy. To facilitate this, Government policy since 2011 has been focused on ensuring that all viable SMEs have access to an appropriate supply of credit for working capital or other purposes from a diverse range of bank and non-bank sources.
As regards the success of Government policy towards assisting SMEs with enhanced lending, it should be noted that the most recent Department of Finance credit demand survey shows that 86% of credit applications were approved by the banks, with positive trends also seen around trading performance, profitability and employment.
The Strategic Banking Corporation of Ireland (SBCI) was established during September 2014 with the core purpose of enhancing the supply of credit to SMEs. The SBCI has already signed up the two largest SME lenders in the country, AIB and Bank of Ireland, to deliver products to SMEs. Loans have been available since 9 March 2015 at branches of both banks throughout the entire country. SBCI's funding must be passed to SMEs and the SMEs must receive the full benefit of any discounted rate offered to the partner lenders. SBCI has committed €200m to each of the initial bank lending partners and has a further €400m available to other future lenders. Talks are continuing with circa ten other potential funding partners from both the banking and non-banking sectors. The SBCI will offer working capital facilities which are of at least 2 years duration. It can also offer loans for investment on longer terms, loans to agriculture and loans for the refinancing of credit originally extended by banks who have since exited the Irish market. Further information is available at http://sbci.gov.ie/.
In seeking to build on the progress to date and to further support the financing of growth within the SME sector our focus in 2015, outlined in the Action Plan for Jobs, will be to implement a series of actions under the following thematic areas:
- Support and influence the effective implementation of major policy initiatives to ensure that the maximum benefits are afforded to SMEs;
- Continue to raise awareness and understanding amongst SMEs and entrepreneurs of the full suite of State business supports that are available;
- Ensure that the Local Enterprise Office network is a key conduit in providing information, support and advice to small businesses on access to finance issues and strengthen the linkages between enterprise capacity building, accessing finance and business guidance;
- Deepen our engagement with international funding institutions;
- Facilitate and support the development of a more diverse range of financing options for SMEs;
- Maintain a strong focus on policy impact, evaluation and learning; and
- Develop measures to ensure prompt payments and promote improvements in the payment culture and practices in Ireland.
