Filed under: Small Business News — Alan @ 12:22 am
Small businesses are still getting short shrift from lenders, and that is contributing to the overall economic problems in the UK, according to the Federation of Small Businesses. John Walker, FSB’s National Chairman, says that the figures reported by the BBA (British Bankers Association) do not reflect the actuality of what’s happening to small start-up businesses.
The Association reports that it is ‘on target’ to meet the lending criteria set out by the Treasury’s 2011 initiative called Project Merlin. That target is £76 billion for small and medium businesses this year, and in the first half of 2011 the banks loaned £37.4. According to a spokesman for Merlin’s member banks that include Barclays, Lloyds Banking Group, Santander, HSBC and RBS, by that measure the banks are fulfilling their commitment to small business.
However, an independent survey by a BBA task force made up of banks and business organisations demonstrates that smaller businesses with up to nine employees were more than twice as likely to be refused when they applied for a loan, and more than half of the businesses in that category didn’t even apply because they expected to be refused.
Walker said that this means smaller businesses that make up over half of the UK’s GDP are losing out on opportunities to expand or to get started in the first place. FSB is urging the Independent Banking Commission to make strong recommendations to Government for more competition amongst the major banks to respond to the need for financing of businesses that have not yet established a strong credit history. Walker believes that those businesses will be a key factor in economic recovery for the UK.
Filed under: Small business — Alan @ 3:09 am
Britain’s major banks have committed to lending small businesses £70 billion over the course of the New Year as part of efforts to stop exchanges with ministers.
The pledge was made the leading top executives of the leading five UK banks along with Chancellor George Osborne and Business Secretary Vince Cable. After the meeting it was decided that £200bn would be dispersed to business customers over the course of 2011 a portion of which would be dispersed to the small businesses.
In attendance at the meeting were the heads of Lloyds Banking Group, HSBC, Statander UK, Barclays, and the Royal Bank of Scotland.
The figure is roughly largely than last year showing a 10% increase over what banks lent to SMEs during 2010.
Therefore, when you account for inflation rates and the projected growth of the economy over 2011 the lending may not be adequate to offer SMEs room for growth over the year. However, it is hoped that the increase will help settle the complaints of ministers that there is not enough free credit available in the economy.
This move is of large significance because it will be the first time that bank lending will not be supported by taxpayers and will still have to meet the same lending targets from before the economic fallout.
The tone of the meeting was said to be upbeat with the banks agreeing that they need to commit to the further recovery effort in terms of lending and credit.
Filed under: Business Finance,Loans,Small business — admin @ 4:51 pm
There are a number of instances where small business loans can be called upon to revitalise a company, as well as address some of the impending issues it may be facing. For many people, the most costly part when starting out can be at initial set up, but they can also find that once they are up and running it becomes necessary to obtain a little more collateral in order to compete with their fellow entrepreneurs.
One area in particular which can benefit from such a financial boost to push you ahead of your peers is market presence. This means cash might be needed to spend in a number of areas – including advertising, marketing and improvements to any online facilities you may have in place. If your firm is already enjoying a period of growth, expenses can also come from elsewhere, such as new staff and bigger premises. In most cases these don’t come cheap – but they may be absolutely essential if you want your small business dreams to come true and your projects to continue to flourish.
For some start ups, technology plays a big part in day-to-day affairs and may even be a key element in the products and services you provide to your customers. This can mean it is vital to have access to the best hardware, software, data storage, telecommunications or manufacturing facilities. After all, if you fail to furnish your company with the most up-to-date systems, what’s to stop one of your competitors jumping ahead of you and doing just that?
So what options are available for Lloyds TSB business account customers looking to kick start, boost or expand their brand? Well, one option that could provide a short-term, flexible solution is an overdraft, which can be handy when unexpected overheads arise. For a more long-term investment, a loan could be more appropriate for you needs – and with variable and fixed-rate options available to applicants the terms can be tailored even further.
Once a small business has started to make its mark on the community, thoughts may also turn to making sure a dedicated headquarters is available to your growing staff – at which point it may be prudent to look at a commercial mortgage. That is, of course, if refurbishing and building upon your existing premises is not a realistic possibility.
Those who do decide to opt for a Lloyds TSB business loan will find there are a number of tempting features to the range of packages that could be just what they have been looking for. If the purpose of the cash is to fund a long-term strategy, the fact you could repay over a term of up to 30 years might be of interest, while being able to borrow anything from as little as £1,000 means smaller, quick-fix investments are also a possibility.
Optional loan protection is also available to help out in the event of sickness, accident or death and the bank offers you the opportunity to make your application on the telephone or in your local branch – look at our website for more details.
Any property given as security which may include your home, may be repossessed if you do not keep up repayments on your mortgage or other debts secured on it. All loans are subject to status and we will need your permission to carry out a credit check on you and your business. You should not apply for an amount that you cannot comfortably afford to repay.
Lloyds TSB Bank plc Registered office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065.
Lloyds TSB Scotland plc Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland no. 95237.
Authorised and regulated by the Financial Services Authority under numbers 119278 and 191240 respectively.
Licensed under the Consumer Credit Act 1974 under registration numbers 0004685 and 0198797 respectively.
We subscribe to The Lending Code; copies of the Code can be obtained from www.lendingstandardsboard.org.uk
Small businesses are still getting short shrift from lenders, and that is contributing to the overall economic problems in the UK, according to the Federation of Small Businesses. John Walker, FSB’s National Chairman, says that the figures reported by the BBA (British Bankers Association) do not reflect the actuality of what’s happening to small start-up businesses.