Demand for business loans goes down

Demand for business loans goes down

The smaller the businesses, the smaller the demand has been for loans at the start of this year. This is confirmed by the Bank of Albania in its latest report on lending.

“Demand for loans by businesses was lower in the first quarter of 2019”, the country’s central bank says, adding that this demand was low for both investment loans and cash flow loans, which means that companies have been reluctant in demanding loans when they’ve needed money to make payments, opting for other options rather than increasing their debts with the bank.

On the other hand, banking experts have also noticed that micro-businesses and medium sized businesses were more “restrained” in applying for a loan, while large businesses have risked more during the beginning of this year.

But experts expect the situation to change.

“In the second quarter of 2019, banks are expecting to see a higher demand for business loans and businesses of all sizes are expected to contribute to this increase”, experts explain, adding that “demand for loans is expected to be high for both cash flow loans and investment loans”. This seems to offer more optimism in the lending market compared to previous years.