Banks received almost 74 thousand loan applications in 6 months, rejected 30% of them

2025-09-25 07:23:54, Ekonomi CNA

Banks received almost 74 thousand loan applications in 6 months, rejected 30% of

Private sector demand for credit increased again in the first half of this year.

According to the Bank of Albania, the total number of loan applications reviewed by banks increased by 1.7% compared to the same period a year ago.

The number of applications, however, has been increasing only in the case of the individuals segment (by 2.7%), but decreasing in the other two segments (small and medium-sized enterprises, by 14.3% and large enterprises, by 0.8%).

During the first half of 2025, banks reported that they processed a total of 73,646 loan applications, of which 92% belonged to the individual segment. The share of individual demand has increased further from the 91% level of the previous year.

Although the demand for credit has increased significantly, it seems that in the first half of this year, banks have been more selective.

Of the total applications reviewed during the period, around 30% were rejected by banks. This rate has increased by 5.1 percentage points compared to the first half of last year. The increase in rejections has been more pronounced in the case of the small and medium-sized enterprise sector.

The total rejection rate has resulted in an increase, both for banks with domestic capital and those with foreign capital.

It is noted that during the period, the two banking groups have shown similar attitudes towards individual loan requests, continuing the tightening trend compared to the previous period and compared to the previous year.

This attitude is significantly more evident among foreign banks, which have rejected around 40% of individuals' requests, compared to domestic banks, where this rate has resulted in 18%.

At the same time, both groups of banks remain more receptive to the corporate segment, but the trends have been different over the period. Thus, foreign banks have had a restrictive stance towards small and medium-sized enterprises, rejecting around 20% of loan requests, while remaining focused on lending to large enterprises, rejecting only 2% of their loan requests.

Domestic banks have displayed a more balanced stance, rejecting only 5% of requests from the small and medium-sized enterprise category and 5% from the large enterprise category.

Despite the increase in the rejection rate, figures show that lending to the economy has continued to grow this year.

For the period January-July, a total of 231.9 billion lek in new loans were granted, an increase of 10% compared to the same period last year.

While last year's credit growth was mainly based on business financing, this year the main contribution is being made by the growth of loans to individuals.

New loans to individuals reached the value of 77 billion lek, an increase of 26% compared to a year earlier.

Lending to individuals has been supported by very rapid growth in two main segments, real estate purchases and consumer financing.

While loans to businesses were worth 151.3 billion lek, with an increase of 1.1% compared to the same period last year./ Monitor Magazine