The Bank of England announced that the amount loaned under the Funding for Lending Scheme had fallen.

The monies lent through the project had fallen by £3.9bn in comparison to the first quarter of 2014. The fact that the commercial property sector is reportedly borrowing less from the banks has contributed towards this.

Overall, the amount borrowed by small and medium-sized enterprises (SMEs) was down by £435m during the second quarter of this year. However, promisingly this is a smaller drop than for the first quarter, when the amount lent fell by £700m compared to the end of 2013.

Large firms also borrowed less, with this amount down by £3.5bn. Commenting about the news, the director-general of the British Chambers of Commerce, John Longworth, said:

“…much more needs to be done to fill the major gap in the provision of SME finance in the UK.”

The Funding for Lending Scheme was set up to enable banks to loan more to British businesses. Under the project, the banks were able to borrow money from the Bank of England at a cheap rate, which in turn was to be lent to UK firms. Unfortunately, many SMEs are still finding it hard to borrow the cash that they need to expand from the banks.

Many are turning to alternative financial solutions, like those provided by DJB. We specialise in asset financing, equipment finance, and operating leasing. All of these alternative forms of financing can be arranged quickly, and are suitable for practically any size firm. Contact us to find out more.

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