A new survey from the Department of Finance shows that 57% of SMEs reported a profit in 2021, compared to 31% in 2020 and moving closer to the 69% of SMEs that reported a profit in 2019.

The latest SME Credit Demand Survey also showed that 14% of SMEs reported a loss last year, while 26% broke even.

Trading conditions have improved significantly in the months from March to October, coming close to the levels recorded pre-pandemic in September 2019, the survey revealed.

It also reveals that 46% of SMEs reported increased turnover, 31% reported stable turnover and 24% reported a decline in turnover in the six months to September 2021.

The survey - conducted by Behaviour and Attitudes on behalf of the Department of Finance - is the most comprehensive survey of SME Credit Demand in Ireland, covering over 1,500 respondents.

It found that 17% of SMEs applied for bank credit. This marked a 1% decrease on 2020 and was down 3% on September 2019.

Only 7% of SMEs said they expect to apply for credit in the following six months.

Of those SMEs that applied for credit, 40% said they wanted it for a new business venture, acquisition of assets or expansion, up from 16% in October 2020.

The average loan size was €208,469, an increase from €192,185 in October of 2020.

Today's survey also noted that 9% of all SME credit applications were declined from the months between April and September 2021. However this rate rose to 21% for micro businesses.

When questioned about Government supports, SMEs had greatest awareness of Enterprise Ireland and Local Enterprise Office initiatives at 87% and 79% respectively.

On the type of Government support SMEs prefer, 42% said they would like a longer-term investment loan scheme with loan repayment term, with some SMEs preferring credit guarantee schemes (21%) and working capital loan scheme (18%).

Finance Minister Paschal Donohoe

Finance Minister Paschal Donohoe said the latest SME Credit Demand Survey gives important insights into the continued impact that Covid restrictions had on Irish SMEs during 2021, while also allowing us to perceive the significant recovery in overall SME performance compared to 2020.

"One of Government's main concerns is to ensure that SMEs continue to have access to sufficient liquidity, and that access to credit for SMEs is maintained and I particularly welcome the high level of awareness among SMES of the Government supports available to them," Mr Donohoe said.

"The SME Credit Demand Survey series allows us to gain critical understanding of the Irish SME landscape which allows us to develop, refine and implement policy measures to support our home-grown businesses," he added.