British banks have said that they do not expect to increase the amount of lending available to businesses in the second quarter of 2013. This is despite the rise in the amount of companies looking to secure loans to help grow their businesses.
A survey by the Bank of England has shown that lenders predicted that overall credit availability would see little to no change. The banks have been saying that the amount of money lent to companies hasn’t grown due to the lack of demand, but this doesn’t appear to be the case.
In the first 3 months of 2013 business lending did increase slightly but only to large companies, while small to medium businesses have been left out in the cold.
Adam Marshall, director of Policy at the British Chambers of Commerce said: “SMEs continue to be left out in the cold by lenders.”
“The signs of growing business confidence must not be choked off by credit constraints.”
The cost of business borrowing has fallen slightly which is a positive note, this is largely attributed to the Government’s Funding for Lending scheme.