A credit review committee aimed to tackle the issue of credit to small and medium-sized businesses was formally launched today.
The office, which is being headed up by former banker John Trethowan, will review the lending practices of the banks covered by the guarantee scheme.
SMEs, farm owners and sole traders who have had their written application refused or reduced and feel that the bank's decision is unjustified can apply to the office, once the borrower has already gone through the bank's own internal loan appeals process. SMEs are defined as businesses with less than 250 employees with an annual turnover of less than €50 million, and/or a balance sheet total of less than €43 million.
The review process will deal with loans of up to €250,000, but Mr Trethowan said that this may be extended if the office finds that there is sufficient demand.
While the office has no statutory function, Mr Trethowan said that he has been in consultation with the banks, and was confident that they will adhere to its findings.
The Credit Review Office, which begins operating today, will have a small team of administrative staff; in addition, it has a pool of approximately six former bankers who will work as reviewers as cases come in, and will be paid on a case-by-case basis.
Mr Trethowan said the application process was designed to avoid unnecessary bureaucracy, following consultation.
A minimum fee of €100 and a maximum charge of €250 will be charged for the service, based on a percentage of the loan request.
SMEs can make applications to the scheme through the website, www.creditreview.ie.
