According to a survey, around one in four German company’s currently seeking new loans are reporting restraint from lenders as high inflation and concerns over energy supply rattle Europe’s largest economy.
“The difficult economic climate is currently making banks more cautious. Without new loans, some companies might struggle for economic survival,” Klaus Wohlrabe, head of surveys at ifo said in a press release.
Among service providers, as many as 28.8 percent of companies seeking credit, banks are reluctant to lend.
In manufacturing, around 8.4 percent of companies seeking credit in the chemical industry and 22.5 percent in the automotive industry reported difficulties. In trade, however, the figure was just under 15 percent of these companies.
The smallest businesses and the solo self-employed were most affected due to their dependency on bank loans.
Again Wohlrabe said, “For microenterprises, other forms of financing such as bonds are more difficult or impossible to use. They often depend on bank loans.”