To address the difficult financing situation of SMEs, Vice-President Antonio Tajani, Commissioner for Industry and Entrepreneurship, in agreement with Michel Barnier, Commissioner for Internal Market and Services, has proposed to upgrade the SME Finance Forum into a high-level dialogue between financial institutions and SMEs. It will monitor market developments and will recommend concrete actions to improve access to finance and the financial markets for SMEs.

Data from the European Commission and European Central Bank indicate that bank credit standards are still tight, net demand for loans from enterprises declined and almost 20% of SMEs’ bank loan applications are rejected. The SME Finance Forum 2010 held in Brussels focuses on new strategies for improving access to finance for SMEs.

The last economic downturn has lowered both supply and demand of lending to firms. The growth prospects of Europe require that the flow of bank lending to firms return to normal as soon as possible. The April 2010 bank lending survey of the European Central Bank (ECB) indicated that bank credit standards are still tight. 83% of banks have kept their credit standards to SMEs unchanged. Most banks also expect that their credit standards remain tight in 2010.

Tight credit conditions endanger the growth or even survival of European small businesses, as almost 20% of loan applications from SMEs are rejected. Further, changes in capital requirements and other banking regulations are making the financial system safer, but their overall impact on bank lending should be carefully assessed without undermining financial stability.

New steps need to be taken to make listing of medium-sized firms in stock markets easier. Thus, the Commission believes the visibility of smaller firms needs to be enhanced.

The Commission is reviewing the application of several securities markets directives imposing obligations on issuers (such as the directive on transparency obligations of listed companies or the directive on market abuse) with the "think small first" principle in mind. A conference on the application of the directive on transparency obligations will be organised on 11 June 2010, where this issue will be specifically addressed.

The SME Finance Forum 2010, which is currently taking place in Brussels, will examine access to loans and capital in Europe and explore strategies to improve access to finance for SMEs. As a follow-up to this SME Forum, a high-level dialogue between representatives of financial institutions and SMEs will be set up to monitor market developments and make recommendations on how to improve access to finance.

Recently, the OJEU has published the new Microfinance Facility, which is tailored to micro-enterprises, employing fewer than 10 people (91% of all European businesses), and unemployed or inactive people who want to go into self-employment but do not have access to traditional banking services. 99% of start-ups in Europe are micro or small enterprises and one third of these are launched by people who are unemployed. This Facility, which also enhances access to finance for SMEs, will be operational from June 2010.