The BDRC Continental SME Finance Monitor for the first quarter of 2012 finds that the percentage of SMEs predicting growth stands at 48 per cent, up from 44 per cent in the final quarter of 2011.
Of the 20,000 SMEs questioned, 37 per cent say that the current state of the economy remains the main barrier to running a business in the desired way, compared to 35 per cent in Q4.
The survey also shows that the proportion of SMEs which are set to apply for finance in the next three months has increased from 14 per cent to 16 per cent, with confidence that the bank would agree to requests up six percentage points to 52 per cent.
Some 25 per cent of SMEs are dubbed as ‘would-be seekers’ – those which would like to apply for finance in the next quarter but will not try to. The figure stood at 20 per cent at the end of 2011.
Looking back over the 12 months of data, and combining loan and overdraft applications, some 90 per cent of renewal applications were successful, compared to a 59 per cent rate for new or increase facilities.
Shiona Davies, director at BDRC Continental, comments, ‘With 12 months of data in the SME Finance Monitor, we can see that overall overdraft success rates have improved but that challenges remain for applications for new or increased borrowing.
‘We can now give a clearer picture of what helps and what hinders these applications for finance. This is key information for SMEs in the current difficult economic circumstances.’
Of BDRC Continental’s recommendations for SMEs is the need to demonstrate financial capability by showing how the business’ bank account has been run.
Further tips include having a trained accountant, financial controller or staff member with a financial qualification and producing regular management reports when applying for new facilities.
