Business lending falls dramatically, despite FLS
Tracy Ewen, managing director of IGF, comments on Bank of England figures showing that the Funding for Lending Scheme (FLS) is failing to make credit available to SMEs:
“Banks have proven unable to provide the long term lending that SMEs need to grow. If this trend continues, the UK’s major financial institutions are in danger of unintentionally ushering in an era of business credit dominated by smaller, more nimble lenders. Large scale corporate finance is currently not an option for many SMEs who have an ‘alternative’ business model. These businesses should look to the smaller lenders who can judge the individual merits of a business on a case by case basis and lend to them accordingly.
It is largely accepted that SMEs are at the heart of the growth of our economy and so making affordable credit available is absolutely crucial to help small and medium sized businesses return to growth. The mainstream banks and FLS have had a long time to prove their worth and, sadly, have not been able to match the ambitions of many small businesses.”