The chamber surveyed 212 companies. Slightly less than half of these sought funding, with two-thirds rejected, the poll found. Those who didn't apply said the application and approval processes are too complex.

The chamber conducted the poll to help the Industry and Trade Ministry develop a strategy to utilize both EU Structural Funds and national funding to support SMEs through 2013. Structural Funds are designed to strengthen the economies of new EU member states. The next round of funding runs from 2007 to 2013.

SMEs often complain that it's too difficult to get funding from these and other governmental support programs. Professional business associations say the rules for receiving funding from programs such as Structural Funds are too complex for the majority of companies. Those that do meet the requirements often don't receive full funding.

"The conditions are so stringent that companies choose to get a bank loan rather than going through the procedure of applying for support and disclosing information to the government," said Jaroslav Vlček, general director of the Small and Midsize Business Association.

The poll found that the vast majority of SMEs indeed do just that to finance their operation costs and development.

Vlček said the administrative hurdles connected with obtaining support are so obtrusive that many companies decide not to waste their time applying. The state should simplify the mechanism for distributing the funds, he said, so that state funding can play a greater role in SME development.

"Bureaucratic requirements should be reduced," Vlček said. "A lot of the paperwork and requirements make no sense."

At the same time the survey showed that Czech SMEs have real need for funding because most have plans to expand, the larger ones even looking at foreign markets. For the most part, however, SMEs don't have the capital to finance expansion and are too small to get equity by offering shares on the stock market, known as an initial public offering.

Other professional business associations share this opinion.

"I cannot imagine a small company raising money through selling shares," said Bedřich Danda, chairman of the Association of Entrepreneurs of the Czech Republic. "In my opinion, the demand for capital is exceeding the offer on this market."