Limited access to credit has become an ever greater impediment for small and medium-sized companies, according to new research published yesterday by the Economic and Social Research Institute.

In 2009, almost one in five such firms cited access to finance as a problem. That has increased to almost one in four in the most recent figures – for the end of 2012 and early 2013.

Both the magnitude of the problem and the trend over time has differed from the average across the euro zone. Irish SMEs have not only consistently faced greater credit constraints than their euro zone counterparts, but while the problem declined in the currency bloc over the past year, it has become more acute here.

Even by European standards, Irish companies are heavily reliant on bank borrowings for their credit needs, as measured by the ratio of bank lending to stock market capitalisation. In some other economies, companies are much more likely to issues shares at an earlier stage of growth and/or issue corporate bonds. The authors of Measuring Credit Constraints for Irish SMEs are Conor O'Toole, Petra Gerlach-Kristen and Brian O'Connell.