There has been much negativity in the media and small business press alike about the way in which banks are hindering the UK’s economic recovery by limiting the amount of finance available to small business and recent company formations.
However, Lord Peter Bridges, the chief economic advisor to the Federation of Small Businesses, has today come out in support of our nation’s banks.
Addressing a conference of small business and company formation owners in Manchester, Lord Bridges admitted that while throughout the recession one of the biggest challenges small businesses have faced is a limited access to finance, banks are facing their own challenges.
Bridges went on to say that the media have cultivated the perception that banks have lost faith in the company formation and SME sector but that in fact the opposite is true:
“Banks are aware of the integral role small businesses will play in our broader economic recovery. From my experience they are doing all they can to help improve the lending situation but still, as yet the funds are simply not available.”
Bridges spoke of his support of the appointment of a ‘Recession Minister’ who would deal with the issues facing small businesses but suggests that change in the banking sector needs to occur at a much lower level:
“Moves need to be made by big banks to re-establish a trusting relationship between enterprise and banks. A banking relationship needs to be conducted at local level and banks need to work hard on improving their customer service and cutting overly bureaucratic processes. Companies need to feel that if they need that overdraft or loan, their application will be dealt with in an efficient and timely manner.”