Good businesses can still get money from banks: SmartCompany poll

Banks may have bumped up interest rates and tightened lending criteria, but there is still funding around for good companies, according a SmartCompany poll.

Banks may have bumped up interest rates and tightened lending criteria, but there is still funding around for good companies, according a SmartCompany poll.

The survey of 71 entrepreneurs revealed that just under 44% have attempted to secure funding from their bank in the last six months, with almost 75% of these entrepreneurs successfully getting credit.

In a surprise result, just over 58% of respondents said the credit crunch was not restricting their ability to grow.

While the banks’ lending criteria appears to have tightened further in the last few weeks as a result of the turmoil on global credit markets, the survey results emphasise the message filtering out of the banking community – it’s not as easy as it was, but good companies can still get money.

Not that entrepreneurs wouldn’t like some extra relief from high interest rates. Almost 85% believe that the Reserve Bank should cut interest rates by 0.5% when it meets tomorrow, even if there are big doubts about whether the cut will actually be passed on.

Just under 12% of respondents said no part of the rate cut would be passed on, while 82% expect the banks to only pass on some of the interest rate cut.

Business owners are also bracing for a prolonged downturn, with 20% expecting it will take more than two years for the credit crisis to ease, 17% tipping conditions will remain tough for more than 18 months and 43% expecting it will take over 12 months for the credit conditions to improve.