The Hong Kong Monetary Authority (HKMA) released the results of its Survey on Small and Medium-Sized Enterprises (SMEs)’ Credit Conditions for the third quarter of 2026 on November 6. The findings indicate a slight improvement in SMEs’ credit conditions, with notable changes in perceptions of banks’ credit approval stances and reported tightening of existing credit lines.
Improved Perceptions of Credit Approval Stances
Excluding respondents who answered "no idea/don’t know," 83% of SMEs perceived banks’ credit approval stance as "similar" or "easier" compared to six months earlier, an increase from 78% in the second quarter. Meanwhile, the proportion of SMEs perceiving a "more difficult" stance fell to 17%, down from 22% in the previous quarter. The HKMA noted that such perceptions could be influenced by factors such as media reports, business conditions, and opinions from personal networks, rather than direct borrowing experiences.
Reported Tightening of Existing Credit Lines Declines
Among SMEs with existing credit lines, 2% reported a "tighter" stance from banks, a decrease from 4% in the second quarter. The survey defines a tighter stance as measures including reductions in used or unused credit lines, higher interest rates, additional collateral requirements, or shorter loan tenors. However, the HKMA cautioned that these reports may not directly reflect changes in banks’ credit supply.
Outcomes of New Credit Applications
Only 2% of surveyed SMEs applied for new bank credit during the third quarter. Among those who had received outcomes, 78% reported fully or partially successful applications, a decline from 85% in the previous quarter. The HKMA highlighted that the small sample size of new applicants (2% of surveyed SMEs) makes these results prone to significant fluctuations and requires careful interpretation.
Survey Context and Methodology
The HKMA has conducted this quarterly survey since the third quarter of 2016, engaging approximately 2,500 SMEs across various economic sectors. The survey aims to monitor SMEs’ access to bank credit from a demand-side perspective. The HKMA emphasized that the results should be interpreted alongside other economic and financial data, as sentiment-driven responses and small sample sizes can introduce volatility.
For policymakers, lenders, and SME stakeholders, the survey provides a nuanced view of credit conditions, highlighting improved perceptions and reduced reported tightening of existing credit lines, but also noting a decline in successful new credit applications.
