The Irish Small and Medium Enterprises Association (Isme) today urged the Government to immediately intervene through the Nama legislation to force banks to free up credit for SME business.
Isme said that its Bank Watch Survey, published today, confirmed that, despite the claims of the bankers, "SMEs continue to suffer from restrictive lending, with almost one in two companies (42 per cent) being refused credit facilities in the last quarter".
The organisation's survey also found that 46 per cent of companies found the banks to be "unhelpful" in their request for finance and that 78 per cent of firms claim banks are making it more difficult for SMEs to access finance.
Isme said that unless the Government intervened, there would be a "huge increase" in company closures and thousands of additional redundancies.
In a statement, Isme CEO Mark Fielding said: "With the Nama legislation being debated in the Oireachtas, the PR Departments of the banks are trying desperately to give the impression that SME lending is not an issue, but the reality on the ground is much different.
"The evidence from the survey confirms what the 'dogs in the streets' know, that the bankers in many instances have closed up shop for SME lending. The bank's claims that they are open for business are simply not true," Mr Fielding said.
"What is really galling for many smaller businesses is the high moral ground being taken by the arrogant banks in their decisions to refuse credit . . . This is a bit rich coming from organisations which had to be bailed out by the taxpayer," he added.