78% of Irish SMEs feel confident about borrowing as they look to expand in 2019

• Almost one in four (23%) SMEs plan to borrow in next twelve months
• More than half (57%) of Irish SMEs expect turnover to grow in the next twelve months
• 81% of SMEs favour Irish banks over Credit Union or private investors to raise finance
• 61% dipping into personal funds to invest in growth over last 3 years

According to new SME research conducted by Bank of Ireland and Red C, 78% of Irish SMEs are confident in their ability to borrow if additional capital is required over the next twelve months, and almost one quarter (23%) already intend to borrow in the coming year. The research findings are launched in conjunction with Bank of Ireland’s 19th National Enterprise Week (5th-12th Oct), which will see a series of 26 events taking place nationwide, around the theme of ‘Investing for Business Growth’ to help SMEs shape the best investment strategy for their business.

Just over one in three (34%) SMEs identified no change in their volume of borrowing in the last few years. While Brexit is a concern for 48%, along with staff recruitment and retention worries, 53% feel positive about the Irish economy in the next twelve months with more than half (57%) expecting turnover to grow.

As SMEs across the country look to grow; working capital, new machinery and equipment are cited as the top reasons for borrowing. Irish banks lead the way as the preferred option for SMEs looking to raise finance, with over 81% claiming they would consider Irish banks over the Credit Union or private investors.

Commenting on the research insights, Michael Lauhoff, Director of Business Banking for Bank of Ireland said:

“The research findings have shed interesting light on current borrowing habits and expectations of SMEs across the country. Interestingly, 60% of SMEs report using personal funds to invest in growth and business efficiencies over the past three years. Although the general sentiment towards the economy is positive among SMEs at present, indeed 53% are feeling optimistic about the state of the economy for 2019, it is important that business owners remember to engage in smart borrowing to grow their business while still maintaining sufficient reserves.

“We are launching this research in conjunction with our 19th National Enterprise Week and hope that SMEs across the country will avail of the series of events taking place in various locations across the country.

“As the number one bank for SME’s in Ireland we are committed to meeting customer needs, and enabling them to thrive at all stages of the business life cycle. In addition to SMEs gaining insights around achieving growth and greater returns and enabling efficiencies, the events will also examine the potential impact of Brexit and how best to prepare. Events will cover all sectors from manufacturing and agri, to retail and hospitality, and will feature spokespeople from a variety of businesses with different success stories.”

For more information on events taking place during Bank of Ireland’s National Enterprise Week please visit www.bankofireland.com/enterpriseweek

About Bank of Ireland National Enterprise Week

Bank of Ireland’s 19th National Enterprise Week takes place from the 5th to the 12th October and a series of 26 free events for SMEs will take place across the country. In line with the Bank’s purpose of enabling customers, communities and colleagues to thrive, the focus for 2018 is helping SMEs shape the best investment strategy for business and the overall theme is ‘Investing for Business Growth’. The Enterprise programme aims to stimulate local economies and enable communities to flourish.

About research

The research results cited are from a survey conducted by Red C among 450 SMEs across Ireland in August – September 2018.