The research is likely to reopen the debate as to whether the country’s bailed out banks are open for lending to Irish business.
The Irish SME Credit Supply and Demand, Comparisons Across Surveys and Countries report comes from two economists at the Central Bank.
The research revealed that SMEs are twice as likely to have a business loan application rejected compared to the euro zone average for loan refusals.
It said that high rejection rates in Ireland cannot be explained by the quality of the pool of potential borrowers.
More than 25% of loan and overdraft applications from small business were rejected in recent months. That compared to one in 28 in Germany.
The report also found that Ireland has the euro zone’s second highest rate of discouraged business borrowers.
The Central Bank economists recommend that steps must be taken to improve perceptions of lending
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