SME's struggle to get finance...
Unfortunately it appears that Banks are reluctant to lend money
to SME's and although the government are trying to encourage
lending, it still seems to be falling. In fact the Daily
Telegraph has reported recently that lending to small businesses
has fallen by 33%. A fall of £4.7 billion has been recorded
from figures taken in February compared with those in March.
Businesses who contact their Banks for credit are simply being
turned down and are therefore having to look elsewhere for
finance. Banks have said that they are willing to lend… so
what's going wrong?
It would seem that Banks have become much more 'picky' over who
they choose to lend money to and for those businesses that are
lucky enough to be accepted for additional lending they may have a
lengthy wait on their hands as lenders certainly seem to be taking
their time and reviewing every application in detail.
Unfortunately it seems that the government simply aren't doing
enough for small businesses and something needs to change.
The Enterprise Finance Guarantee scheme is shrinking and needs to
be pulled back into shape. If small businesses cannot lend
money through the EFG scheme, for many, business opportunity may be
lost as the cost to borrow from other sources may simply be too
expensive.
Small businesses are an extremely important element to our
economy and we need them to survive. If funding for SME's no longer
exists, this will have a detrimental impact on other areas of the
economy.
Let's hope the government can rescue the situation soon and
SME's can get the backing they need to fulfill their business
needs.