SME survival 'dependent on government loans'

News Article - 18 February 2009
Category: Regulatory

The survival of business growth within the UK's small and medium-sized enterprise (SME) sector depends on unrestricted government loans, in the opinion of one sector commentator.

Stephen Sklaroff, director general of the Finance and Leasing Association, said the economic downturn meant that small businesses in particular were relying more heavily on asset finance deals to obtain new equipment.

He added: "A third of business loans are through asset finance, so it is vital that the government's effort to support lending in the economy is not restricted to traditional bank loans."

Recent reports have suggested that UK banks have leant only a fraction of the amount provided to them for the purpose of lending to smaller businesses.

Furthermore, the total figure is still not close to the amount the government earmarked for small firms that have been struggling to stay afloat.

And according to the Finance and Leasing Association, it is such small companies in London that have been hit the hardest by the economic downturn.

---

More industry news

• Banks defend lack of lending with new taskforce
• Fallout begins from public spending cuts
• Only 4% of staff would approach manager with health concerns
• CFOs in dark about carbon management spend
• UK car production falls
• New CRC standards will benefit top performers
• Employee engagement at ‘all time low’
• Finance leaders back green reporting standards push
• UK worker productivity linked to performance bonuses

Back to news home page »