Early figures released by Lloyds, Barclays, Santander UK, HSBC and RBS indicate that business lending targets set out under the terms of the Government’s Project Merlin will be met.
Project Merlin was set up in February this year, and saw the UK’s leading five banks commit to lending £190 billion to businesses in 2011. Whilst initial figures ahead of the half way point this Thursday indicate that lending is slightly ahead of set targets, at £100.4billion over a £95 billion target, there are calls that the banks have not gone far enough, especially in respect of lending and credit facilities for SME’s.
Figures for SME lending by the five banks will come in at £37.4bn – against a half-year target of £38bn. A recent survey of their members by the Federation for Small Businesses (FSB) back up that SME’s are still struggling to achieve access to finance. A third of their members who had applied for credit, had been refused.
My own experience as a solicitor helping clients with corporate finance matters is that many of those who have applied for loans via the traditional high street bank route confirm that securing finance remains an uphill struggle. When you see financially solid businesses with many years of excellent trading figures and history with the banks are being refused finance, it is little wonder that alternative investments have certainly become a more popular and often more viable route for businesses looking for funding.
For advice on access to finance, or alternative investments, including private investors, please do not hesitate to contact me.