According to the Annual Report of the Bank of Italy published on May 30, credit demand from Italian businesses is declining: -2.6% year-on-year, with a particularly sharp drop for small and medium-sized enterprises (-6.8%).
This is an important indicator for anyone trying to understand the current state of the relationship between businesses and financial institutions.
Giuseppe Cristiano analyzed its dynamics and implications in an article published in Economy Magazine, explaining that several factors are driving the reduction in demand: high interest rates, increased self-financing, perceived economic uncertainty, and stringent requirements imposed by European regulations to lending institutions.
Why are businesses asking for less credit, even though bank lending capacity appears to be growing?
The answer lies in a combination of structural and cyclical factors: from the global macroeconomic context (the new approach to tariff policies, energy costs, international tensions) to the perceived risk associated with SMEs, and the new structure of the banking system, which is increasingly concentrated and less rooted in local communities.