HKMA Reports Stable Credit Conditions for SMEs in Q4 2024

The Hong Kong Monetary Authority (HKMA) has released the findings of its latest survey on the credit conditions for small and medium-sized enterprises (SMEs) for the fourth quarter of 2024. According to the survey, SMEs in Hong Kong experienced broadly stable credit conditions during this period.

Credit Approval Stance Perceptions

The survey reveals a slight shift in SMEs’ perception of banks’ credit approval stance compared to six months prior. Excluding respondents who were unsure, 70% perceived the credit approval stance as “similar” or “easier” in Q4 2024, a decrease from 76% in the previous quarter. Conversely, 30% believed the stance had become “more difficult,” up from 24% in the previous quarter. It is worth noting that these perceptions may not directly correlate with actual difficulties in obtaining credit, as they can be influenced by external factors such as media reports and business conditions.

Banks’ Stance on Existing Credit Lines

Among SMEs with existing credit lines, none reported a “tighter” stance from banks, a slight improvement from 1% in the previous quarter. A “tighter” stance can involve measures like reducing credit lines, raising interest rates, or imposing additional collateral requirements. However, this metric may not fully reflect the actual credit supply to SMEs.

New Credit Applications

Regarding new credit applications, 4% of surveyed SMEs applied for new bank credit in Q4 2024. Among those who had received outcomes, 77% reported fully or partially successful applications, a slight decline from 79% in the previous quarter. The survey cautions that due to the small sample size, these results may be subject to significant fluctuations.

Survey Methodology

The survey, conducted by the Hong Kong Productivity Council (HKPC) on behalf of the HKMA, covers approximately 2,500 SMEs from various economic sectors each quarter. Initiated in the third quarter of 2016, it aims to monitor SMEs’ access to bank credit from a demand-side perspective. The survey results are intended to be interpreted alongside other economic and financial data, as they reflect sentiment that may be influenced by unique events during the survey period.

For more detailed tables and technical information, visit the HKPC website at HKMA.

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