The vast majority of small to medium-sized enterprises found it possible to gain credit through an overdraft arrangement in 2012, according to the SME Finance Monitor from BDRC Continental.
In the latest 2012 end-of-year report from the ongoing data series, BDRC reports that 73% of new overdraft applications were approved last year.
Coupled with overdraft renewals that did not require fresh applications, that takes the success rate to 90%, meaning just one in ten firms that sought lending in the form of an overdraft were unable to gain approval.
Among those who were granted an overdraft, seven in ten were put in place within a week, and nine in ten overdrafts were available well before they were needed.
In terms of non-overdraft loans, 57% of all applications made throughout the year were successful, of which around two thirds were in place within a fortnight of approval.
According to the 2012 end-of-year report, “recent applications for new loans or overdrafts have been more likely to come from first-time applicants and/or those with a worse-than-average external risk rating, and such SMEs remained less likely to have been successful”.
Of those whose application was declined, just 14% of overdraft applicants and 8% who applied for loans were aware of the right to appeal; two-thirds rated as ‘poor’ the information provided to them by their bank.