Study: Many high street banks refusing business loans

18 June 2012

Many high street banks in the UK are still denying small businesses the opportunity to access credit, new research has revealed.

A study published this morning (18 June) by the Federation of Small Businesses (FSB) showed that nearly half of all such firms - 41 per cent - who attempted to gain finance from lenders in the second quarter of the year were refused.

Some 20 per cent of the 2,800 companies questioned indicated that the lack of access to funding is proving to be their main hurdle to achieving a strong rate of growth.

Meanwhile, the FSB noted that banks' reluctance to provide credit is harming the wider economy as it is restricting the ability of organisations to create new jobs, but more Scottish firms are now positive about their prospects than are negative.

Andy Willox, Scottish policy convenor for the FSB, observed that chancellor George Osborne's Funding for Lending initiative could provide more support for the business community.

"None of the previous bank-led schemes has been an unparalleled success in funding the real economy. This scheme must be different," he noted.

By Asim Shah

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development