“Latest figures on bank lending in the UK show that net lending to small and medium sized businesses plummeted in July, due to higher repayments. In July, lending to SMEs decreased by £0.9bn, compared to an average monthly decline of £0.2bn over the past six months. These figures buck the wider trend of increased bank lending to the wider economy. Lending to non-financial businesses as a whole, including large companies, grew by £0.5bn. Goncalo de Vasconcelos, founder of equity crowdfunding platform SyndicateRoom, compared the fall in SME lending to falling off a cliff.
Bigger, established businesses with assets can borrow, companies with few if any assets can all too often sing for a loan from their bank.
Whatever we read about forward guidance, and creating a positive economic environment, in July, for smaller businesses at least, things moved backwards.”