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The Government is working on developing a new loan guarantee scheme for small firms that have been locked out of credit by the banking crisis. But just hours after Minister for Enterprise, Trade and Innovation, Batt O'Keeffe announced the Government was working on a loan guarantee scheme, one of the key players in the ongoing dispute over the availability of credit to SMEs said he does not favour a loan guarantee scheme. The Irish Independent reported that John Trethowan, who heads up the Credit Review Office, said he was "sceptical" about how effective a loan guarantee scheme would be and warned it was being portrayed as a cure for all small firms' problems when this was not the
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Few doubt that small firms, the backbone of local communities, have been hit hard by the credit crunch. Many firms which would be viable when viewed from a long term perspective, have been forced prematurely to the wall, having been cut off at the knees by newly risk averse, cash strapped banks. Crunching Hard and Deep The accountancy group Mazars, has carried out a series of studies on credit availability. The latest review, published in mid April, indicates that while we have entered a period of stabilisation, the crisis remains very real. According to a statement issued by Ian Talbot, CEO of Chambers Ireland: "We note with concern that 35% of all loans granted to SMEs are now behind on payment. This figure is likely to act as deadweight on future loan applications and approvals, p
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