Syscap, the lease finance provider, has said that recent figures show there has been a near 20% increase in vendor finance for the six months before the end of July. This amounts to over £2.5 billion and shows that some firms are more likely to allow their customers to borrow to make up for the lack of lending to small and medium-sized enterprises.
Philip White is the chief executive of Syscap and he has commented, “the government should be encouraged to offer alternative finance options, some non-bank firms have a better position to offer loans than banks. In the market, small businesses do not want to borrow and banks do not want to lend.”
George Osborne, the Chancellor of the Exchequer, has told the Treasury to get money into the economy through credit easing. This is a type of monetary activism which will probably see the government purchasing SME bonds.
Recent data has suggested that borrowing conditions are stabilising for manufacturers in Britain, this data has come from EEF – the manufacturers organisation. Improvements in lending for companies has not come without its costs, borrowing rates are still high and rates on existing borrowing are continuing to increase.