Financial barrier to export plans ACCESS to finance is the major impediment for Australian small to medium enterprises looking to invest overseas, new research shows. A survey by the Export Finance and Insurance Corporation (EFIC) - the Australian government's export credit agency - found one in four SMEs had or planned to invest in international markets. But 58 per cent of those who had established overseas operations reported difficulties in accessing finance. When funding international growth, 45.8 per cent of SMEs said they used overseas banks, compared with 39 per cent who worked with Australian financial institutions. Of those planning to export, 57.6 per cent said they would approach overseas banks, compared with just 19 per cent who would seek finance in Australia. EFIC director for SMEs Robert Dravers said it was concerning that financial barriers appeared to be stifling the investment plans of many Australian small businesses. "Difficulty in accessing finance is clearly a common theme that is holding SMEs back from building a footprint overseas," he said. When faced with a knock back from a preferred source of funding, many SMEs are unaware where to turn for assistance. SMEs are asking for more assistance and support in accessing funding sources. He said this highlighted the key role government and industry bodies should play in helping SMEs with their export plans. The survey, of more than 2000 SMEs, found more than three-quarters of respondents relied on personal networks, word-of-mouth and trading partners for advice about establishing overseas operations. "While much can be learned from personal research and peer experience, there is clearly a gap for formal advice and assistance, which could significantly boost SMEs' success rate overseas," Mr Dravers said. Access to formal information and advice, coupled with assistance securing finance, can mean the difference between success and failure for SMEs looking to invest overseas. SMEs may not be aware that seeking guidance and input from an early stage in the planning process from industry groups and government agencies, such as Austrade and EFIC, can help stand them in much greater stead for overseas success. The research revealed 35.6 per cent of SME exporters had experienced failure in overseas investment. The main reasons for their lack of success were cited as market knowledge and planning and finance. Mr Dravers said EFIC was introducing a financial guarantee for Australian banks which aimed to help SMEs access finance for overseas investment. "Success in international business these days usually requires a strong presence on the ground," he said. This helps position companies to grow business in existing and neighbouring markets or to compete for global supply chain opportunities. There is a pressing need for greater financial support for Australian companies undertaking overseas investment.