KIB's 2024 Annual Report: SME Lending Stable Despite Trade Sector Rise
As 'Kredītinformācijas Birojs' (KIB), the country's leading credit bureau, has released its annual report for 2024. The report reveals key trends in the small and medium-sized enterprise (SME) lending landscape.
KIB manages the largest database of credit histories, covering both individuals and legal entities. In 2024, the total amount issued in loans reached over 725 million euros. Despite this significant figure, the number of borrowers and newly concluded contracts remained almost unchanged, with a less than 2% increase.
The most frequently credited companies were trading companies, agricultural and forestry companies, and businesses providing professional, scientific or technical services. However, the trade sector overtook agricultural and forestry companies as the most financed sector in 2024. Businesses in the construction sector and manufacturing followed closely in the ranking.
Limited liability companies (LLCs) dominated the SME group, accounting for 91% of all borrowers, with farms making up the remaining 8%. LLCs most often concluded agreements with credit institutions for financial leasing (41%), operational leasing (20%), and issuing business credit cards with a credit limit (17%).
Concerning delinquency, 1.5% of borrowers were more than 60 days late in the first year of their contract, with a debt amount of at least 150 euros. Despite high interest rates in the second half of 2024, there was no significant increase in loans issued to the SME sector.
The SME lending landscape in 2024, as reported by KIB, shows a stable market with a significant loan amount issued. The trade sector's emergence as the most financed sector and the dominance of LLCs in borrower numbers are notable trends. Despite some delinquency, the market remains resilient, with no major shifts in loan issuance despite high interest rates.
