The Business Secretary, Vince Cable, has admitted that the Government\u2019s Funding for Lending scheme is not working – as net lending to SMEs fell in the first two quarters of this year.<\/p>\n
The scheme was designed to encourage lenders to provide more credit to smaller businesses, but recently the number of bank\u2019s providing these loans has plummeted.<\/p>\n
It was recently revealed that during the first quarter of 2014 lending fell by \u00a3723m, which was followed by a further \u00a3435m drop in the second quarter.<\/p>\n
Speaking during an event for the British Business Bank, which was reported in the Times, the Business Secretary said that the bank restriction of credit to SMEs \u201cpersisted to this day\u201d with more and more money being taken away from SME lending.<\/p>\n
Mr Cable said: \u201cEver since I got into government I\u2019ve been having conversations with George Osborne about how we get small business lending going.<\/p>\n
\u201cOur initial instincts were, we have these big banks who have been rescued by the state, why on earth don\u2019t they do it? For a variety of reasons, it never happened.<\/p>\n
\u201cThey were left at an arms\u2019 length basis, there was difficulty with the private majority shareholders of RBS and the Treasury didn\u2019t want to go down that road, they were interested in preparing them for privatisation, so that route didn\u2019t work.\u201d<\/p>\n
Cable also blamed banks for giving business owners a \u201cbad deal\u201d saying that SMEs were being forced to take matters into their own hands.<\/p>\n
Banks have recently been forced by government to ask SMEs if they would like their information shared with alternative lenders should the business be rejected for a bank loan.<\/p>\n
This was followed in August by the George Osborne encouraging SMEs to seek financing from crowd-funders, peer-to-peer lenders and invoice financiers.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Business Secretary, Vince Cable, has admitted that the Government\u2019s Funding for Lending scheme is not working – as net lending to SMEs fell in the first two quarters of this year. The scheme was designed to encourage lenders to provide more credit to smaller businesses, but recently the number of bank\u2019s providing these loans […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/453"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=453"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/453\/revisions"}],"predecessor-version":[{"id":454,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/453\/revisions\/454"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=453"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=453"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=453"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}