Autumn Statement 2011: BBA: Statement will boost SME confidence
The BBA said credit easing and other measures including cutting business rates for SMEs by 1% would make a “serious addition” to the large sums already being lent to the business community by banks.
BBA figures suggest businesses are currently borrowing around £664bn from the UK’s high street banks.
BBA chief executive Angela Knight said: “Independent research has found that the main disincentive to borrowing is continuing concern about the economy. The times are uncertain and the more confidence that can be given about the supply of credit the better.
“With the eurozone crisis putting lack of confidence at the top of the list of concerns in every comprehensive survey of business, this Statement makes it clear that money is available for viable businesses.”
The BBA said in the past few months banks have created and financed a UK-wide network of 11,000 business mentors, an independently-monitored appeals process, a £2.5bn Business Growth Fund for equity investment in growing businesses and conducted 17 roadshows where representatives of more than 2,000 businesses have gathered to meet with bank executives.
The banks are also working with Community Development Finance Associations (CDFIs) to provide essential finance for higher-risk start-ups.
Knight said: “Together with today’s announcements from the government to support businesses, these initiatives should provide companies of all sizes with the assurance and confidence to borrow for growth.”
Knight added that the increase in bank levy to 0.088% from 1 January 2012 created uncertainty.
She said: “The banks are committed to playing their part in restoring the public finances through the many different taxes they pay.
“But a stable tax regime is important: banks of all nationalities do business around the world from here and they pay tax here. Certainty is an important requirement.”