business lending

FPB: Restore Trust in Banks & Boost Alternative Funders

The Forum of Private Business is responding to the release of the first quarterly finance monitor commissioned by the British Bankers’ Association’s (BBA’s) Business Finance taskforce. The not-for-profit Forum is calling for measures to restore trust in banks and help alternative funding platforms compete in finance markets dominated by mainstream lenders, following figures suggesting confidence and trust in these is in decline. According to the report, published today, a total of 15% of SMEs – or approximately 670,000 firms – needed funding during the past year but did not apply for it. Even more – almost one in five small businesses (18%) – believe they will need finance in the next three months but feel they will be unable to apply for it unless... »

Project Merlin: Business Lending Hasn’t Stalled

The Government has denied reports that negotiations with the UK’s main banks to improve lending to small firms have stalled. As previously reported (Small Business Lending Deal Stalls) the banks have apparently delayed an agreement to lend £200 billion to small businesses in 2011. Reports claim that bank bosses have argued that the lending target is not in the best interest of their shareholders. However, the Department for Business, Innovation & Skills (BIS) denied that the banks were holding out on the discussions, known as “Project Merlin”, saying no lending targets had yet been agreed. “Absolutely nothing has been agreed – the banks haven’t stalled.” said BIS spokesman, Miles Erwin. “The banks have made a proposal on lending and we’re discussing this with them. &l... »

Small Business Bank Lending Deal Stalls

A deal between the coalition government and the UK’s top banks on lending to small businesses has stalled, according to a report by the BBC. "Project Merlin" was supposed to see Britain’s four biggest banks (RBS, Barclays, HSBC and Lloyds) increase lending to small business with bankers showing restraint in the payment of bonuses, particularly at Royal Bank of Scotland and Lloyds which are 84% and 41% "taxpayer owned" respectively. The deal was expected to be confirmed in the forthcoming week with lending to SMEs to increase by around 10% in 2011. The total of small business lending was estimated to be in the region of £200bn and it was anticipated that the government might be lenient on banking bonuses if the big four were to simply increase business lendin... »

More “human” Approach to Business Lending Needed

Barclays Bank is right to fight Government-imposed lending targets for small firms, say business groups – but they want competition among banks and a more “human” approach to lending. Speaking to the Financial Times, the head of Barclays’ small-business unit, Steve Cooper, argued that imposing lending targets would create a culture of making weak loans simply to meet targets. Cooper was speaking in response to news that the Government is exploring the option of introducing targets to all banks, not just the part-nationalised banks in which it owns a stake. But small-business groups are united with banks in opposing the suggestion. “We agree with Barclays that they are best placed to decide who to loan to,” said Forum of Private Business (FPB) spokesman Chris Gorman. “We value Government pr... »