Frontpage News 2014 90 per cent of Dan...

90 per cent of Danish SMEs get a “Yes” in the bank

20 November 2014

Analysis: The vast majority of Danish companies get a “Yes”, when they apply for a bank loan, and the acceptance rate in Denmark is among the highest in Europe. This is evident in a new and comprehensive analysis of 16,875 SMEs’ access to financing conducted by the European Commission, including 500 Danish.

About half of the Danish small and medium-sized enterprises (SMEs), which have participated in the European Commission’s analysis, express that they have experienced greater turnover and earnings in the last six months. This is also reflected in a rather high acceptance rate, when the companies apply for bank loans.

According to the survey, a total of 80 per cent of the Danish SMEs, which have applied for a bank loan, respond that their application was approved. 4 per cent almost got their application approved, while 6 per cent got their application partially approved (cf. figure 1). The rest was rejected by the bank or declined because of heavy financing costs.
 
 
Figure 1: Access to financing  
Source: Survey on the access to finance of enterprises. April to September 2014.
Note: The survey is based on 16,875 SMEs in the EU, including 500 Danish.

The heavier financing costs are partly a result of the new stricter regulation of banks, which have resulted in more expensive bank loans.
 
The high acceptance rate and a good customer/bank relationship help to explain why Danish SMEs have the courage to go to the bank. The study shows that 79 per cent of the Danish companies feel comfortable with discussing financing with the bank, and that they will achieve the preferred result.
 
 
Figure 2: Confidence in the bank
Source: Survey on the access to finance of enterprises. April to September 2014.
Note: The survey is based on 16,875 SMEs in the EU, including 500 Danish.
 
Asked directly, the Danish SMEs answer that competition, skilled labour/experienced managers and regulation represent their greatest issues. According to the survey, a minor issue is to find customers. The companies indicate that access to financing is the least pressing issue (cf. figure 3).
 
In comparison with the EU-level, the access to financing is ranked a significantly lower issue for the Danish companies.
 

Figure 3: Pressing issues for the compan
Source: Survey on the access to finance of enterprises. April to September 2014.
Note: The survey is based on 16,875 SMEs in the EU, including 500 Danish.
 
 
 
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About the study “Survey on the access to finance of enterprises (SAFE) – analytical report 2014”

The European Commission has conducted oral interviews with a total of 500 Danish companies in the period April-September 2014. In EU-28, 16,875 company interviews have been carried out.
 
Companies by number of employees
 
Number of employees Percentage share
1-9 employees
34
10-49 employees
​35
50-249 employees​
​31
SMVs​
​100
​250+
​0
 
 
The year the company was registered
 
Yea Percentage share
< 2 years
75
2 years - < 5 years
14
5 years - < 10 years
10
> 10 years
​1
​N/A
​0
 
 
 
 
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