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Banks to publish data on local lending to small businesses

 

Major banks have agreed to publish local lending data across 100,000 postcodes as part of a new government agreement, the Chief Secretary to the Treasury Danny Alexander has announced.

 

From January next year, seven British banks will provide details of loans to small businesses and homeowners in what will be the most detailed lending breakdown to date.

 

The data will be published on a quarterly basis by the British Bankers' Association (BBA) and the Council of Mortgage Lenders. It will include details of lending to small businesses, mortgage offers to households and unsecured personal loans, excluding credit cards.

 

It is hoped the move will encourage banks to boost the credit offered to small businesses and homeowners.

 

Mr Alexander has described the agreement as a ‘major step forward’ for transparency.

 

‘From next year, businesses will be able to see exactly where the major banks are lending - up to within a few streets of their premises’, he said.

 

‘It is a major step forward in terms of transparency and should encourage competition by helping smaller lenders to identify gaps in the market and allowing businesses to hold their local bank to account where they aren't lending.’

 

Meanwhile, the BBA has released details of its analysis of lending in 120 postcodes between 2011 and 2012.

 

It found that lending to small businesses fell in more than 80% of the local areas studied.