Europe’s SMEs turn to online lending as bank credit tightens

Beincrypto reports that Europe’s small and medium-sized enterprises are increasingly turning to online lending platforms and crowdlending as access to traditional bank finance tightens. SMEs are central to the EU economy: according to the European Parliament, in 2025 the bloc had approximately 26.1 million SMEs employing more than 89.8 million people, and European Commission data show SMEs make up 99% of businesses and generate over half of value added in the non-financial economy.

Yet financing is becoming constrained, with persistent underfinancing and a structural realignment of credit markets. Banks have applied stricter standards—9% reported tighter SME credit conditions in Q4 2024, early 2025 saw ongoing net tightening, and by Q3 2025 euro area banks still signalled net tightening with 4% reporting stricter criteria—and weak demand in 2025 is described as a symptom of constrained access rather than ample credit.

In response, online lenders and crowdlending platforms are positioning themselves as faster, more flexible alternatives: ResearchAndMarkets projects the alternative lending market in Europe will grow at a 13.6% CAGR through 2029. Digital platforms can process typical SME funding requests in one to two weeks versus several weeks or months for banks, and technologies such as Web3 are cited as improving transparency, automation, and costs.

Key Topics

Business, Smes, European Union, European Commission, Banks, Online Lending