All eyes on bank lending to small businesses
As we begin a raft of results from UK banking institutions all eyes are on the level of lending to the UK small business arena as opposed to profitability, which is already expected to be in the billions of pounds. While historically the UK banking sector has been very supportive of the small business arena, over the last two years we have seen a massive reduction in liquidity in this particular market which is causing significant financial hardship across the UK. So will UK banks increase lending to small businesses?
There is no doubt that there is massive scope for an increase in lending to the small business arena but whether UK banks feel now is the time to increase lending remains to be seen. As ever it is a case of risk/reward and with many believing that the risks are on the downside in the short to medium term it is unlikely that we will see a massive increase in the level of funding for small businesses in the UK. This comes despite the fact that the UK government would appear to have made lending to the small business arena a major target in the short to medium term.
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