Bank lending remains subdued for small businesses as lending contracts again, but the Funding for Lending Scheme has lessened the issue
Commenting on the data released by the Bank of England on the Funding for Lending Scheme (FLS), Phil Orford MBE, Chief Executive of the Forum of Private Business said,
“At -£0.7bn net lending to small and medium sized businesses is down on last year. The figures could be worse were it not for the extension of FLS, which increased the incentives for lending to small businesses in particular. The figures replicate the findings of the most recent SME Finance Monitor, which continues to show a subdued appetite for lending. At a sectoral level some of the decline in lending is down to reduced appetite to lend to the real estate sector so for the rest of the economy the picture is slightly brighter. At a time when the economy is picking up there is no doubt the figures remain slightly disappointing.
“Banks are keen to stress they have money to lend and the Forum of Private Business continues to urge businesses that money is there to borrow at present, either through the main or challenger banks, or through alternative sources, some of which are highlighted on the excellent Alternative Business Finance website.”