Hong Kong Monetary Authority: Hong Kong SME Lending Situation Remains Stable

We have learned from a survey released by the Hong Kong Financial Management Authority (HKMA) on August 1, 2025. The survey found that the lending situation for Hong Kong SMEs remained generally stable.

Regarding the perceived difficulty of banks in approving loan applications, excluding respondents who answered "no opinion" or "don't know", 65% of respondents felt that bank approval rates for loans in Q2 2025 were unchanged or easier compared to six months prior, lower than the 75% recorded in the previous quarter. 35% felt that banks' approval rates were harder, while 25% reported so in the previous quarter. The perception of difficulty does not necessarily reflect SMEs' actual difficulties in borrowing, as it can be influenced by various factors such as media reports, business operations, and personal opinions.

Among respondents who had already obtained loans, 1% reported that banks had tightened their loan approval rates compared to the previous quarter, a decrease from the 5% recorded previously. The meaning of "tightening" includes various possibilities, such as reducing credit limits and loan amounts, increasing interest rates, requiring more collateral or shortening loan tenors, etc. Therefore, respondents' perceptions of bank loan approval rates do not directly reflect banks' actual lending to SMEs.

The survey also collected data on the results of new loan applications. 3% of respondents reported applying for a new loan in Q2 2025. Among respondents who knew the application results, those who reported complete or partial success accounted for 67%, lower than the 79% recorded previously.

Due to the small number of SMEs with existing loans and those that have applied for new loans, which only account for 16% and 3% of respondents respectively, the survey results may be subject to larger fluctuations, and interpretation should take this into consideration.