Lending to Greek small and medium enterprises (SMEs) increased 25.2% from 2023 to 2024 to reach €5.94 billion, but represent a shrinking share of overall business loans in the country, according to a recently released OECD report.
The data, although several years old, reflect the positive momentum of the Greek economy in the post-COVID and post-bailout market.
However, the fact that SMEs are taking a smaller portion of business loans in comparison to total business lending activity hints at an “uneven pace of credit recovery among different enterprise sizes, with small businesses still facing notable hurdles in accessing finance,” says the OECD.
Specifically, SMEs accounted for 28.4% of business loans in 2021, which fell to 24.8% over the reporting period.
Although NPLs dropped to 3.98% in 2024 from 7.65% in 2023, interest rates to SMEs were still at 5.7% in 2024 against the lower borrowing cost to large firms (5.44%).
Economists consider the imbalance notable, because SME’s represent 99% of the Greek economy, employ 84.7% of the workforce and generate 62.8% of the value.
Credit is recovering in the country, and the Greek government has made supporting SMEs a key financial policy priority, but the numbers raise questions about whether Greece’s SMEs are truly receiving financing proportional to their economic role.
