The ECB's monetary policy decisions have a direct impact on interest rate movements, which in turn affect other financial variables (e.g., stock prices) and the behavior of various economic actors, including businesses; these effects can be significant, especially for Small and Medium Enterprises (SMEs), which often face greater difficulties in accessing bank credit and capital markets.

Here are the most relevant aspects to consider:

• In a situation of rising interest rates, the most immediate consequence for a business is usually an increase in the interest portion to be paid on existing loans (if variable rate loans are in place); this situation, prolonged over time, leads to higher financing costs, greater difficulty in accessing credit, and less favorable refinancing conditions. If the situation persists for long periods, the company's ability to meet its obligations may deteriorate, and excessive stress on liquidity may ultimately lead to the company's failure (insolvency risk).
• In a situation of falling interest rates, the most immediate consequences are certainly a reduction in liquidity outflows for interest payments on existing loans (if contracted at variable rates), as well as easier access to credit markets (or improved financing conditions); over the long term, a reduction in interest rates often leads to an increase in liquidity available to companies, which can more easily plan investments and development projects.

In both cases, an SME must be able to manage interest rate volatility with a tool capable of generating scenario analysis, with more or less favorable assumptions. The company's ability to promptly adjust its investment/financing plans becomes crucial, with immediate feedback on the economic-financial impacts in the short (within 12 months), medium (3-5 years), and long term (over 5 years). These projections can lead to important strategic decisions, such as interventions on the financing mix, changes in sales and marketing strategies, and revision of internal costs.

Dynamic Business Planner (DBP) is the solution designed to provide all these tools to SMEs, thanks to its financial planning, scenario analysis, and reporting functionalities in a standard format that is immediately understandable to external stakeholders (especially financial and credit institutions).