That is according to chancellor George Osborne, who has indicated that more needs to be done to help the nation's companies grow and therefore stimulate the wider financial recovery, the BBC reports.
In recent times, there has been plenty of speculation regarding the role of lenders in assisting British firms in their attempts to expand.
For instance, the British Chambers of Commerce and the London Stock Exchange recently called on the government to play a more hands-on role in supporting businesses through the implementation of credit easing.
However, Mr Osborne explained there is still a "disconnect" between the opinions of the banks and businesses in terms of lending.
"I'm sure of course there's an issue with demand. Some businesses are just nervous. But I think there's also a lack of supply - I think there is a lack of competition," the official noted.
By Claire Archer