1 in 5 SMEs faces difficulties getting finance

In particular, employer companies have faced growing difficulties in accessing finance. The Yrittäjägallup survey shows that the bottlenecks to finance are slowing down the growth of ever more SMEs.

“It beggars belief that just when several bodies in Finland are looking for ways to boost growth, a dysfunctional finance market is hindering growth-oriented and growth-capable SMEs’ growth,” says Petri Malinen, an economist at Suomen Yrittäjät.

The finance problem is particularly strongly evident among young business owners. Of them, almost one in three says that difficulties accessing finance are slowing down their businesses’ growth.

Of all the SMEs which experience finance difficulties, as many as 40% have said a project has failed to be completed because of problems accessing finance.

The Yrittäjägallup survey was answered by 1,054 representatives of micro-enterprises and SMEs between 7 and 13 Nov. Of the respondents, 45% were single-person business owners.

Companies unable to meet demand

Finance bottlenecks are weakening companies’ abilities to meet growing demand. Over one in five SMEs says that accessing finance has, at least to some extent, reduced the company’s ability to meet growing demand.

“If SMEs have problems meeting demand because of difficulties accessing finance when the Finnish economy isn’t growing, the problem could well explode when the economy starts growing. Then, the big threat is that we’ll lose some growth because of the finance bottleneck,” Malinen says.

“The finance markets don’t work as they should in Finland. It’s clear that finance regulation and control, as well as the banks’ risk control principles, have created circumstances in which SMEs cannot get finance,” Malinen says.

Read the results of the Yrittäjägallup survey in more detail here.