A new study released jointly by KfW and the Ifo Institute for Economic Research reveals a worsening of credit access for German Mittelstand (mid-sized businesses) in the second quarter of 2025. The findings indicate that 35.2% of Mittelstand companies are encountering difficulties during loan negotiations, a 1.4 percentage point increase from the previous quarter.
Banks are implementing stricter lending requirements across most sectors of the economy, with the exception of the construction industry. Within construction, the proportion of companies perceiving bank behavior as restrictive has decreased to 26.8%, a reduction of 2.8 percentage points, potentially benefiting from recent government infrastructure initiatives.
Large corporations, however, are experiencing improved access to credit. Only 21.5% of these businesses reported facing significant hurdles in securing loans, a decrease of 2.1 percentage points.
The study also highlights differing levels of interest in borrowing. Just 20.9% of small and medium-sized enterprises engaged in loan discussions, while a significantly larger 30.3% of large corporations expressed credit interest – an increase of 3.1 percentage points. KfW attributes this growth in interest among large enterprises to preparations for increasing trade barriers and larger government investments in infrastructure and defense.
“A noticeable easing of credit access for small and medium-sized enterprises will not occur spontaneously” stated Stephanie Schoenwald, an economist at KfW-Research. She emphasized that a resurgence in lending activity requires a sustained reduction in trade-related uncertainties and a demonstrably stronger economic upturn.