Survey on the Access to Finance of Enterprises in the euro area – Third quarter of 2025 – European Central Bank

Report on Enterprise Finance in the Euro Area: An SDG Perspective

Executive Summary

This report analyzes the findings from the 36th round of the Survey on the Access to Finance of Enterprises (SAFE), conducted in the third quarter of 2025. The data, gathered from 10,225 firms, is assessed through the lens of the United Nations Sustainable Development Goals (SDGs), with a particular focus on SDG 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation, and Infrastructure). The survey reveals a slight tightening in overall financing conditions, posing potential challenges to sustainable economic progress. While firms report increased investment activity, crucial for SDG 9, concerns over the economic outlook, rising costs, and access to skilled labor present significant headwinds. Small and medium-sized enterprises (SMEs), which are vital for inclusive growth under SDG 8, face more pronounced difficulties, including deteriorating profits and declining turnover, highlighting the need for targeted support to ensure a sustainable and equitable economic recovery.

Analysis of Financial Conditions and Sustainable Economic Progress

The Financial Environment’s Impact on SDG 8 (Decent Work and Economic Growth)

The overall financial environment shows signs of tightening, potentially impeding the economic dynamism required to achieve SDG 8. A net 2% of firms reported an increase in bank interest rates, reversing the easing trend from previous quarters. This development is particularly concerning for SMEs, which reported a net 5% increase in interest rates, potentially constraining their ability to invest, expand, and create decent jobs. The general economic outlook was cited by a net 19% of firms as the primary factor negatively affecting the availability of external financing, undermining the stable and predictable environment necessary for sustainable growth.

• Overall Financing Conditions: A slight tightening was observed, reversing the easing trend from 2023.
• Bank Interest Rates: A net 2% of firms reported an increase, with SMEs experiencing a more significant tightening (net 5%) than large firms (net -3%).
• Economic Outlook: Remained the primary constraint on financing availability, hindering progress towards a stable economic environment conducive to SDG 8.

Investment in Innovation and Infrastructure (SDG 9)

Financing continues to be directed towards activities central to SDG 9, which promotes resilient infrastructure, inclusive industrialization, and innovation. Fixed investment remains the most common use of financing, cited by 39% of firms. This commitment to capital expenditure is fundamental for building productive capacity and fostering technological advancement.

1. Primary Use of Financing: Fixed investment (39% of firms) and inventories/working capital (37%) were the main purposes, directly supporting industrial capacity and operational stability.
2. Investment Activity: A net 8% of firms reported an increase in investment in Q3 2025, a positive signal for SDG 9. However, this was driven primarily by large firms (net 14%), while SMEs showed only a marginal increase (net 5%).
3. Future Outlook: Firms expressed reduced optimism about future investment, with expectations for Q4 2025 slightly lower than in the previous survey. This cautious stance could slow the pace of innovation and infrastructure development.

Enterprise Performance and Resilience for Inclusive Growth

The performance of enterprises, especially SMEs, is a critical indicator of progress towards inclusive economic growth as outlined in SDG 8. The survey highlights a growing divergence between large firms and SMEs.

• Turnover: On balance, firms reported no change in turnover. However, this masks a significant disparity: large firms indicated improvements, while SMEs signaled declines, challenging the goal of equitable growth.
• Profits: A net 13% of firms reported a decline in profits, a trend more widespread among SMEs than large firms. This pressure on profitability can limit resources for reinvestment and job creation.
• Financial Vulnerability: The share of financially vulnerable firms remained low at 3%, indicating a degree of resilience in the corporate sector, which is a positive foundation for long-term sustainable development.

Key Challenges to Sustainable Enterprise Development

Macroeconomic and Operational Headwinds

Firms identified several major concerns that limit production and pose direct barriers to achieving sustainable development objectives. These challenges highlight systemic issues that affect the capacity of businesses to contribute effectively to SDG 8 and SDG 9.

• Availability of Skilled Labour: Cited by 63% of firms as a major concern, this shortage directly impedes the achievement of decent work and higher productivity goals under SDG 8.
• Production and Labour Costs: A major concern for 62% of firms. Rising costs can squeeze margins, limiting funds available for sustainable investments (SDG 12) and the provision of decent wages (SDG 8).
• Finding Customers: A concern for 53% of firms, signaling demand-side weakness that hinders overall economic growth.

Access to Finance as a Catalyst for the SDGs

While direct obstacles to obtaining finance remain low, shifts in application behavior and lender sentiment could impact the financing of future sustainable projects. The role of financial institutions as partners for the goals (SDG 17) is crucial.

• Loan Applications: The share of firms applying for bank loans fell to 17%, primarily because internal funds were deemed sufficient. While this reflects financial health for some, it may also indicate a reluctance to pursue ambitious new investments aligned with SDG 9.
• Financing Obstacles: The percentage of firms facing obstacles to obtaining a bank loan remained low at 5%, a positive indicator of a functional financial infrastructure.
• Lender Sentiment: Firms reported less optimism about banks’ willingness to lend, with the net balance of firms seeing improvement falling from 6% to 2%. This shift could signal future constraints on credit availability for sustainable initiatives.

Conclusion: Aligning Financial Access with Sustainable Development Objectives

The 36th SAFE survey presents a dual narrative for the Euro area’s progress towards the Sustainable Development Goals. On one hand, continued investment in fixed assets and low corporate vulnerability provide a solid foundation for advancing SDG 9 and SDG 8. On the other hand, significant headwinds from tightening credit conditions, persistent cost pressures, and a challenging economic outlook threaten to slow this progress. The widening performance gap between large enterprises and SMEs is a particular concern, as it undermines the principle of inclusive growth central to the 2030 Agenda. To ensure the financial system acts as an effective catalyst for sustainable development, policy focus should be directed at maintaining a stable macroeconomic environment and ensuring that SMEs have the necessary access to finance to innovate, grow, and create decent work.

Analysis of Sustainable Development Goals (SDGs) in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

1. SDG 8: Decent Work and Economic Growth
   • The article directly addresses economic growth by analyzing key business performance metrics such as turnover, profits, and investment activity of enterprises in the euro area. It provides a detailed assessment of the financial health and operational environment of firms, which are fundamental drivers of economic growth.
   • The focus on employment, including expected employment growth (0.9% over the next year) and major concerns like the availability of skilled labour (a concern for 63% of firms), connects directly to the “decent work” aspect of this goal.
   • The extensive discussion on the access to finance for Small and Medium-sized Enterprises (SMEs) is central to fostering entrepreneurship and sustainable economic activity.
2. SDG 9: Industry, Innovation and Infrastructure
   • This goal is addressed through the article’s focus on “fixed investment” and the financing of productive assets. The report states that fixed investment remained the most common use of financing (39% of firms), which is essential for building resilient infrastructure and upgrading industrial capabilities.
   • Target 9.3, which aims to increase the access of small-scale enterprises to financial services, is a core theme of the report. The survey analyzes loan application rates, financing obstacles, and the availability of credit, providing a clear picture of the financial environment for industrial and other enterprises.
   • The article also provides a sectoral breakdown (industry, construction, services, trade), offering insights into the economic conditions and expectations within different parts of the industrial and service economy.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. Under SDG 8: Decent Work and Economic Growth
   • Target 8.3: “Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services.”
     
     The article is almost entirely dedicated to this target. It analyzes the financial conditions, access to loans, and financing obstacles specifically for enterprises, with a consistent distinction between SMEs and large firms. For instance, it notes that only 5% of firms faced obstacles in obtaining a loan, and that 93% of the surveyed firms were SMEs.
   • Target 8.5: “By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.”
     
     The article provides data relevant to this target by reporting on firms’ expectations for employment growth (an average of 0.9% over the next year) and wage increases (expected to be 3.0%). It also highlights that the “availability of skilled labour” is the most significant concern for 63% of firms, pointing to challenges in achieving productive employment.
   • Target 8.10: “Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all.”
     
     The report assesses the behavior of financial institutions by examining bank lending conditions. It mentions that a “net 2% of firms reported an increase in bank interest rates” and that on balance, “2% of firms reported an improvement in banks’ willingness to lend,” providing direct insight into the functioning of the banking sector in providing financial services to enterprises.
2. Under SDG 9: Industry, Innovation and Infrastructure
   • Target 9.3: “Increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets.”
     
     This target is strongly supported by the article’s core focus. The entire “Survey on the Access to Finance of Enterprises (SAFE)” is a mechanism to monitor this. The article details the “share of bank loan applications” (which fell to 17%), the reasons for not applying (sufficient internal funds), and the “financing gap indicator,” all of which measure the access of enterprises, particularly SMEs, to financial services.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

Yes, the article is rich with quantitative data that can serve as direct indicators for measuring progress.

1. Indicators for Access to Finance (Targets 8.3 & 9.3)
   • Percentage of firms applying for bank loans: The article states this share fell to 17% in Q3 2025.
   • Percentage of firms facing financing obstacles: Reported as standing at a low level of 5%.
   • Share of financially vulnerable firms: The article notes this was low, with only 3% of firms experiencing significant difficulties.
   • Bank loan financing gap indicator: This composite index stood at a net -1%, capturing the difference between financing needs and availability.
   • Banks’ willingness to lend: A net 2% of firms reported an improvement, down from 6% previously.
2. Indicators for Economic Growth and Business Health (Target 8.3)
   • Change in turnover: On balance, firms reported no change (0%) in turnover in Q3 2025.
   • Change in profits: A net 13% of firms reported a decline in profits.
   • Change in investment: A net 8% of firms indicated a rise in investment.
3. Indicators for Employment (Target 8.5)
   • Expected employment growth: Firms expect employment to increase by an average of 0.9% over the next year.
   • Expected wage increases: Expectations for wage increases stood at 3.0%.
   • Constraints on production: The availability of skilled labour was the most widely reported major concern, cited by 63% of firms.

4. Table of SDGs, Targets, and Indicators

Source: ecb.europa.eu