Business credit applications on the rise, figures show

The number of companies applying for credit grew between October and December 2011, new figures compiled by Veda have confirmed.

According to the research organisation, the number of firms enquiring about credit grew by 7.3 per cent when compared with the same period from 2010.

Head of commercial risk at Veda Moses Samaha believes the upturn is encouraging and the two interest rate reductions in November and December are likely to have had a positive impact on the statistics.

The study appears to contradict a recent survey conducted by National Australia Bank, which indicated that 70 per cent of business banking customers were not keen to take on any new debts until the economy picks up.

However, Mr Samaha stated that small and medium-sized businesses were particularly optimistic about securing credit in the third quarter of 2011.

"Following a long period of uncertainty, it is good to see some uplift driven by better business conditions and more improved credit management practices," he remarked.

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