SMBs challenges : difficult access to credit and high overdraft rates

SMBs are an important part of the French economy. However, the banking industry offer does not seem to be adapted to their needs, particularly with regard to obtaining credit.  

Indeed, 1/3 of cash credit requests made by SMBs are refused by banks, according to a survey by the Banque de France, increasing the overdraft risk. And this is a second issue that applies to 46% of SMBs since the average overdraft rates are between 10.54% and 14.05%, i.e. 5 to 7 times higher than a traditional credit. To limit these costs and fees, the managers of SMBs say they are ready to accept APRs of 6 to 8% for a credit adapted to their needs, but 52% of them have noticed a deterioration in their cash flow. This is due to the weakness of the options offered by banks, which makes it difficult for them to manage their budgets, often affected by non-compliance with payment deadlines. No fewer than 54,000 SMEs closed down in 2018 for precisely this reason. However, according to 50% of SME managers, the amount needed to reach their stability threshold would only be 5000€. A reasonable amount to consider a short-term credit!