Croydon business chairman calls for better access to finance for small firms
MORE access to finance is needed by small firms if they are not to lose further business confidence.
This is the view of Jeremy Frost, chairman of the 900-strong Croydon branch of the Federation of Small Businesses (FSB).
The FSB has just published its latest quarterly survey of business confidence, which claims that banks have renewed their lending squeeze, with four out of 10 firms being refused credit.
The report also showed that confidence fell in 15 out of 17 industry sectors measured, including financial and real estate, retailing, leisure, hotels, restaurants and bars.
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Mr Frost said: "If small firms cannot access credit it constrains their investment plans. We know from past research that many small businesses missed growth opportunities because they couldn't access the money they needed."
He added: "There needs to be more competition in the finance and banking sector because only when there are more options to choose from will small firms get a fairer deal."
Mr Frost said he believed the ongoing credit squeeze was becoming critical.
He added: "The Government is relying on small business growth to drag the UK out of the recession.
"The will of small businesses to grow is there but the money to enable them to do so is not."
Comments
by Mr_Bravo
Wednesday, July 04 2012, 2:27PM
“Wilcox the big private banks are being told (and actually forced) by regulators to lend more responsibly and hold more high quality assets and capital. This is why the lending has been significantly tightened over the last few years and rightly so. In actual fact it is harming the banks' profitability levels so quite contrary as you say to them "working together to make a mint".
Now we have a scenario where people including yourself are saying we need more access to credit, well guess what, cheap credit and irresponsible lending got our country into this mess. Do you think this is a sensible suggestion for getting us out of it?
Maybe we should let people buy their houses on 100% mortgages again, or throw credit cards at people to keep them spending? How did that work out last time around?
I don't think you understand as much about banking as you think you do thanks to reading the one sided newspaper reports and listening to the deluded politicians desperately shifting the blame onto the banks.”
by Chris_Wilcox
Wednesday, July 04 2012, 1:43PM
“Much as he is right that the Credit Squeeze is real and doing a lot of damage we all know The Private Sector banks work together to make a mint. By not really competing properly. Compare accounts across Banks. It's all much of a muchness really.
I doubt reliance on Private Sector banks will get him what he wants. Bringing a Public Sector bank into the game could well jee things up and give us a proper race though. In the same way Co-ops and Credit Unions can play their role as well.
The Big Private Banks are broken. And will be iffy for years to come as these new regulations come in to stop their dodgy dodgy practices. Even with plans to relax some of the regs on how much cash banks have to hold to cover emergencies these new much-needed firewalls will make it harder for Private banks to offer cheap Credit deals to people. They won't be able to move around there funds as much to cover gambling in the investment Banking circles. So will have to charge a bit more in Retail circles to cover the difference and still make a profit.
Generally debt will be slightly pricier when these new firewalls come in. But it will also be safer to borrow. And I doubt, with that loss of ability to make profits, that Private banks will properly compete for the punters. They only seem to understand dominance and rigging these days.”