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Banks are increasingly lending to small and medium-sized businesses

The first half of the year turned out to be very successful for the majority of Russian banks involved in lending to small and medium-sized businesses. Almost all financial institutions surveyed note a twofold increase in the volume of their loan portfolios. For example, according to Svetlana Kulagina, director of the corporate business department of Rus-Bank, the influx of small business borrowers to the bank more than doubled in 2007. Already in the first half of the year, Rus-Bank issued more than 500 loans worth about 1 billion rubles under the lending program for medium and small businesses. -- the same as for the whole of 2006.

“Today all banks note an increase in the volume of lending to small businesses in their portfolio. Almost all banks provide similar services. A year and a half ago, participants in the domestic SME lending market could be counted on the fingers of one hand. Over the past year, their number has increased several times. However, despite the increase in the number of clients from small and medium-sized businesses, their share in the total loan portfolio of banks does not yet exceed 10%. The main volume comes from lending to corporate businesses,” says Alexander Chvanov, senior specialist at Tatfondbank’s credit operations monitoring department. This means that lending to small businesses is still at the initial stage of its development.

Money for turnover

At the beginning of the year, independent experts estimated the total need for small and medium-sized businesses for loans at 700-800 billion rubles. The same figure was confirmed by the Ministry of Economic Development, citing an assessment of the needs at $30 billion (now the total volume of loans issued does not exceed $10 billion). According to the deputy head of the sales department of banking products for corporate clients of the Moscow Credit Bank, Evgeniy Elsky, even in Moscow, the needs of small and medium-sized businesses for loans are satisfied only by 15-20%, and in other regions of Russia this figure is significantly lower. At the same time, the need for credit resources in the regions of Russia is more acute than in Moscow. According to Svetlana Kulagina from Rus-Bank, banks are just beginning to enter the province, offering simplified and fast lending to small businesses using standardized and proven technologies. Fast and “simple” loans are even less accessible to small businesses located in small towns.

As Alexey Domanov, head of the sales department of the small and medium-sized business department of the Russian Development Bank (RDB), says, referring to a study by bank analysts, only 12% of respondents answered that they use bank business loans regularly, and 53% of respondents intend to attract borrowed money in the near future means.

“Most entrepreneurs have realized that loans are a very convenient product with which they can increase a company’s turnover and help their business develop,” notes Evgeny Elsky from the Moscow Credit Bank. “As a rule, regardless of the size of the company, there is almost always a shortage of working capital.”

With the growth of lending to small businesses, many banks are increasingly differentiating their products every year. They offer clients different types of loans, including issuing loans in accordance with the conditions of government programs to support small and medium-sized businesses.

According to Konstantin Krasnov, Deputy Head of the Corporate Clients Finance Directorate of URALSIB Bank, today small businesses can get a loan for almost any purpose (except startup projects) and on favorable terms (acceptable rates, long terms, individual repayment schedules, deferments for repayment of the principal debt, flexible approaches to securing obligations, etc.).

Svetlana Kulagina believes that, despite the variety of lending programs on the market, usually small businesses planning to take out a loan for the first time do not have much choice. Strict requirements of banks for the form of doing business, reporting, required collateral, and especially real-time processing of an application greatly limit the range of potential borrowers. For this reason, the most optimal lending conditions today are provided by truly “working” programs that apply a simplified approach to reviewing the reporting of small businesses and the necessary collateral. Such programs actually ensure the issuance of a loan within a few days.

According to Alexey Domanov , individual entrepreneurs, as a rule, are interested in obtaining small loans with an annuity repayment structure. Among small companies, loans up to 300 thousand rubles are in demand, which are issued without collateral and do not require a guarantee. Loans in the amount of up to 500 thousand rubles. in RBR they are also issued without collateral, but in this case two people must vouch for the borrower. The interest in these credit solutions on the part of entrepreneurs is due to the small need to attract borrowed funds, because The volume of their own business is still small. In addition, they do not have expensive assets on their balance sheets that can act as collateral.

However, according to the head of the small business lending department of the First Republican Bank, Vadim Malinovsky, “our standard products with an average loan amount of up to 4,500,000 rubles, secured against goods in circulation, are in greatest demand.”

“Trade enterprises most often use microloans,” says Dmitry Golubkov, director of the small business lending department at Uniastrum Bank. -- In our bank, the maximum size of such loans is 1 million rubles, they are issued for a period of up to two years and without collateral. In addition, loans for business development (up to five years with a deferment of principal repayment for six months), “Overdraft” (up to 25% of the average monthly account turnover), as well as loans against cash proceeds (up to 50% of monthly deposits) are in demand. cash account). As for manufacturing companies, they prefer to use leasing, take out loans for business development or for the purchase of vehicles (from 15% per annum excluding commissions). Such loans allow borrowers to purchase expensive fixed assets and provide long-term financing of working capital without damaging their business.”

Transparent intentions

Despite the obvious increase in the number of companies using loans, many businessmen have not yet turned to banks for help. This happens because the majority of Russian small enterprises are still working “without fuss”.

“The share of “shadow” transactions in the turnover of small businesses is still very high,” admits Alexey Domanov. -- The reasons why entrepreneurs resort to tax-saving schemes are clear. According to research by the National Institute for Systematic Research on Entrepreneurship, the most common methods of tax saving are “gray” salary schemes, settlements with suppliers and bribes. Despite the current trend towards a decrease in “shadow” turnover (for example, the share of firms paying salaries “in envelopes” fell from 76% in 2002 to 69% in 2006), a large number of entrepreneurs still use shadow salary schemes.” “Such companies cannot officially confirm their balance, and, as a result, cannot take advantage of the entire list of banking products and services,” notes Eduard Kuzdrov, deputy head of the department for work with corporate clients at Moscow Capital Bank. “In addition, the interest rate on loans for such companies is higher than for enterprises that have a completely transparent business.”

However, despite the not very favorable lending conditions for “gray” income, companies should still use banking services. “When you initially contact the bank, information about the entrepreneur’s activities is 80-90% unofficial,” says Svetlana Kulagina from Rus-Bank. “Already upon repeated application, the degree of legalization increases by 10-15% by transferring part of the transactions to non-cash payments, which also simplifies obtaining a loan and facilitates financing on more favorable terms.”

As Alexey Domanov believes, the pace of small business development largely depends on two factors: the readiness of entrepreneurs to “whitewash” their own business and increase the level of financial literacy. These two tasks are closely interconnected: entrepreneurs often do not understand that by increasing the level of business legitimacy by 20-30%, they have the opportunity to attract credit resources, the financial result of which significantly exceeds the increased tax burden.

The main reason for the reluctance of entrepreneurs to come out of the shadows is the general situation on the market. If one company starts to operate “white-label”, and all its competitors still use tax-saving schemes, it becomes very difficult for such a company to survive in the competition. However, if banks begin to actively lend to conscious entrepreneurs, then due to an increase in turnover, the acquisition of more modern equipment, etc. additional advantages will appear over competitors operating under shadow schemes. It is this example that clearly demonstrates the interrelation of interests of small businesses, banks and the state, which, thanks to the dynamic development of small businesses, reduces its social security costs, including by reducing the unemployment rate and the costs of creating new jobs.

As for banks, their contribution to the development of small and medium-sized businesses is to develop start-up lending programs and expand the geography of their presence. At the moment, in many regions, even if there are banks lending to small businesses, there is no competition between them as such, which, naturally, does not stimulate a reduction in the cost of loans.

According to Ms. Kulagina, with an increasingly large-scale entry into the market of banks, it is possible to predict a decrease in interest rates, an increase in loan terms, an increase in the quality of customer service, the emergence of new banking services aimed specifically at small and medium-sized enterprises, as well as a decrease in requirements for potential borrowers . According to forecasts, the growth rate of this sector will increase in 2007 to 70-80%, and by 2010 the small business lending market could reach about $77 billion.