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Funding for SMEs 'falls by £2.3bn'

 

Small and medium-sized businesses are still experiencing significant problems when trying to access funding, a new report from the Public Accounts Committee has revealed.

 

The research suggests that lending via the Funding for Lending scheme has fallen by £2.3bn since June 2012, stating that there is a lack of understanding of businesses' funding needs.

 

Margaret Hodge, Chair of the Committee, also warned that there is a lack of coherence between Government departments, resulting in an 'ad hoc' approach to funding schemes.

 

According to the report, the number of loans provided under the Enterprise Finance Guarantee scheme has also fallen every year between 2010 and 2013.

However, the Government stated that the report does not 'reflect the reality' that credit conditions for SMEs are improving, with new lending being provided and cheaper loan rates on offer.

Responding to the report, the British Chambers of Commerce has called on the Government to give the new British Business Bank greater powers, including the ability to lend directly to businesses.

The Government has confirmed that the new Business Bank will be fully operational later this year, and is expected to unlock up to £10bn of funding over the next five years.

We can offer assistance with all of your business needs, including help with raising finance. Please contact us for further advice.