24.3 per cent of companies report that banks are reluctant to lend to them

October 24, 2022

Companies in Germany are finding it increasingly difficult to get new loans in the face of overlapping crises, a new survey by the Ifo Institute (https://ifo.de) shows. Currently, 24.3 per cent of those companies that are currently negotiating report reluctance on the part of banks. This is the highest figure since 2017, according to the Munich-based economic researchers.

It is often a matter of survival

“The current unfavourable economic development is making banks more cautious. For some companies, economic survival could become difficult without new loans,” says Klaus Wohlrabe, head of Ifo surveys.

Among service providers, as many as 28.8 per cent of the firms seeking credit report that banks are reluctant to lend. In industry, 8.4 percent of firms seeking credit in the chemical industry and 22.5 percent of firms seeking credit in the automotive industry reported that they were no longer able to get loans easily. In trade, it was only just under 15 percent of these firms.

SMEs particularly affected

According to the Ifo survey, micro-enterprises and the self-employed in Germany are the hardest hit. Here, about every second company seeking credit reports that it is difficult to get loans. “For micro-enterprises, other forms of financing such as bonds are hardly usable. They are therefore often dependent on bank loans,” Wohlrabe sums up.

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