The Spanish economy has maintained a steady GDP growth since 2015. Data from the Bank of Spain place it above 3%. It presents a decrease for the first time announcing signs of stagnation. Showing a decrease in retail consumption. As well as the increase in unemployment with the worst numbers to its credit since the crisis of 2008. But, how is this reflected in the types of credits for companies that entrepreneurs request?. What has been historically in the last 10 years the evolution in the types of credits for companies?. How can the credit market influence and empower SMEs and new projects. Through the credits for companies?.
It is no secret to anyone that since a few years ago the long and difficult process of economic recovery began. The business sector was the one. Despite the inertia and political uncertainty, he took out his chest to achieve this growth in GDP. In its history, due to inflation and lack of liquidity, credit for companies decreased substantially. From almost the beginning of the Spanish economic depression in the year 2008. Mostly due to the economic recession, which originated in the banking entities fear when granting credits for companies. In effect, the credits for companies requested were used to alleviate the effects of the crisis. This was for many SMEs, the death of their productive capacity. What in turn threw for the year 2013. The highest ratio of bank delinquency in history with a 13.62%.
The Private Alternatives to Credit Companies in Recession
Evolving in the way of understanding the financing processes. Obliged by the crisis in the banking sector and the credit market. That caused a progressive contraction of the credits for companies during several years, especially to the Pymes, more vulnerable but more abundant sector of the Spanish economy and that requests the urgent loans. The small and medium businessmen, helped by the vertiginous globalization, looked for new ways to finance themselves. To survive the crisis and even, in some cases, expand. Several new financial figures gained momentum and continue in force.
Well says Michael Gerber, specialist in SMEs, “an entrepreneur sees opportunities where others see only problems.” Then emerged figures such as crwodlending, which is nothing but the attraction of private capital. To invest in a company in exchange for a percentage in the profitability of the business. The Barter or Bartering System, which is a system of exchange between companies and optimizes their operations. Also crowdfounding for new ventures. By means of which capital is attracted and even voluntary work force en masse, in small quantities.
The Spanish crisis of the last 10 years affected the way of seeing credits for companies. They are no longer taken as the only way of financing. Or the only method to launch an organizational development. Since 2014, the Spanish economy has been gradually reactivated. And with it the financial market that grants the different credits for companies. However, entrepreneurs and new entrepreneurs seek not only credit for companies granted by other means. But other ways to obtain the necessary resources for your projects.
Current diversity of Business Credits
Since 2014, the year in which the first positive economic index of 1.4% in GDP was obtained. All economic sectors have been recovering slowly. The credit sector for companies does not escape. Since then they have been granting more and more credits for companies and for new ventures. Both public and private banking institutions, as well as private financial entities. They have expanded their portfolio of credits for companies in recent years.
However, there are several threats to the business sector in terms of its ability to obtain credit for companies. First of all, there is that subtle fall in the financial indexes that we have experienced in the last three months. What for many predicts a deceleration of the productive apparatus. That would indirectly lead in the medium term to the contraction of the credits for companies. Affecting, as always, the SMEs in the first place. The second would be the banking regulation that came into force in January 2018. Through which the Bank of Spain, in application of international regulations. Issued the circular known as IFRS 9. Which requires all Spanish banks to change their way of estimating credit losses. What increased the costs of forecasting in the credits for companies. And therefore, it is a way to restrict the accessibility to the credits for companies.
Finally, we have a factor that can always affect anyone. It’s about the credit scams for companies. They occur to a greater extent between individuals, since their ingenuity has no controls to regulate it. However, they have come to occur among microenterprises. In a moment of desperation, they resort to lenders who promise loans for companies with an extremely low interest rate. To then steal your data by swindling them.