Good business going to wall through lack of credit
With banks starving businesses of vital credit, and an ISME survey revealing that 58% of firms were denied credit by their banks in the last three months, Fine Gael Enterprise Spokesman Leo Varadkar TD has repeated his call for the Government to set up a State-backed loan guarantee scheme for viable small businesses.
“Viable businesses are being starved of credit, putting their future at risk and thousands of jobs on the line. Banks have no excuse for withholding credit from viable companies. But companies, many of them long-standing customers, are still being turned away for loans which would have been granted without a second thought 12 months ago.
“Fine Gael wants the Government to set up a State-backed loan guarantee for viable small & medium sized enterprises. The scheme would see the State acting as guarantor for new loans being sought by viable businesses, and would help them to stay afloat and protect their workforce.
“This guarantee would be funded through the National Treasury Management Agency, and operated through high street banks. It would provide businesses with working capital, and would help them to survive through the recession.
“Small & medium sized enterprises are vital to the economy, employing more than 800,000 people. Many of these firms operate in the retail, tourism and leisure sectors which are all being decimated by the recession. Most are viable operations but urgently need State assistance because of the unprecedented downturn. With the construction sector in meltdown, Ireland cannot afford a new wave of redundancies in the SME sectors.
“Unfortunately, the Fianna Fáil Government has failed to provide any practical measures to protect jobs and businesses, let alone set up a national plan to tackle the unemployment crisis. Fine Gael is the only political Party to put forward effective measures to protect businesses, save existing jobs and create new ones. Businesses need a new team running the country and restore Ireland to economic growth.”