Lending for small businesses - improving?

Sage UK have recently conducted research over the past three months and discovered that of those surveyed more than a third had been declined bank finance during the previous three months.

1500 SMEs in total took part in the survey and the figures not only showed those rejected for finance but a staggering amount – around 58 per cent felt their loan rate was not attractive particularly with interest rates being so low.

Robin Moore, product manager at Sage, says: "The decision on a loan can make or break a firm, so it is a concern that so many SMEs are being declined.

"It might feel like information overload, but by conducting and presenting research that proves why you need the funding, explains how much finance you need and how are you going to pay it back, you can address any concerns the bank may have before they arise."

Our own view is that you can’t disagree with the survey conducted by Sage however based on the economic situation over the last 18 months we have to consider that the banks have had to change their stance on lending across the board. Large businesses have suffered in different ways to their smaller counterparts but have suffered all the same.

We are not financial advisers in any shape or form but the one rule we have learnt in business is the same rule as in personal banking – Ensure you speak to your bank, created detailed proposals and business plans when looking for financial assistance, and keep them constantly aware of your trading situation.