According to a recent report around sixty percent of businesses in the UK were turned down for loans and credit by banks last year despite the fact that the government has been trying to boost lending to businesses.
It has been revealed in a recent report that almost sixty percent of businesses in the UK were turned down for loans and credit last year from banks, even though the government had been putting measures into place to encourage lenders to give credit and loans to businesses that needed them. The data comes from a survey that was carried out recently by the Institute of Directors.
The results showed that fifty seven percent of businesses were denied loans from banks in the UK at a time when many were struggling and needed financial assistance more than ever. Twenty percent of businesses were found to have used credit cards in order to try and stay afloat financially. The results of the study contradict claims from the banking industry that it has been giving finance to businesses.
The British Bankers Association has said that the report from the Institute of Directors could be construed as misleading because the sample size that was used in the study was too small to draw any effective conclusions. However, the report suggested that whilst the government has pumped billions into the economy to try and boost lending most businesses did not benefit from these measures.
The study also suggested that a massive eighty three percent of companies that were turned down for finance received no information about government schemes such as the Enterprise Finance Scheme, which provides government guarantees on loans between one thousand pounds and one million pounds. Twenty percent of businesses were found to have not bothered to even apply for bank loans because they thought that they would either not get the loan or thought that it would be too expensive.
Source - BBC