Increase In Number Of Small Business Loans
When a number of the large high street banks were effectively nationalised by the Government through large loans from the Treasury in order to bail them out, one of the main conditions of the bail out was that the banks in question would use the extra funding to offer loans to individuals and loans to small and medium sized businesses in particular, in order to help them get through the recession and economic crisis and aid economic recovery in the UK.
Since then, both the banks on question as well as the Government, have come under increasing pressure from financial experts and other political parties alike, for still not doing enough to help small businesses obtain the loans they need in order to maintain and develop their business.
But the latest figures from the British Banking Association (BBA) have shown an increase in the number of small business loans and overdrafts granted to companies in January this year, following a particularly low figure for December last year.
Last December, banks lent £511 million in new loans and overdrafts to small businesses, but over the course of January, this had increased to £534 million, accompanied by a reduction in the level of savings in business accounts.
David Dooks of the BBA said “The start of this year saw the monthly value of new lending remain above £500 million a month. Lending to this particular part of the business sector has grown by 2 per cent over the last year, even with the winter months seeing the usual lower demand for bank finance and comparisons with the same time a year ago showing relatively weaker lending. Trading conditions for small businesses continues to be difficult, but after December’s seasonal low number of new relationships, it is encouraging to see small businesses opening bank accounts in similar numbers to previous months.”
