The ASC Blog

A vicious circle – why RBS “can’t force businesses to borrow”

Published 16/05/2013 10:44:00

The £20 billion question!

The Managing Director of RBS is lamenting the fact that they cannot “force businesses to borrow” and suggest that they have some £20 billion which is available to small businesses.

On the other hand, we hear every week that businesses cannot borrow from the banks. So what is the truth? It is quite simple; by applying common sense one can analyse the situation carefully as follows.

Yes, RBS is right in saying that business finance is available and that they are prepared to lend. Equally, SMEs are right to say that banks are very difficult to deal with and throw up many hurdles. I’ve mentioned on previous occasions that obtaining a business loan is like entering a boxing match – you have to be prepared to go all the 15 rounds and you have to be prepared to roll with the punches. Nobody wants to go back to the lending mentality which banks displayed in 2007 (the days of 125% mortgages), so everybody agrees that there have to be a sensible lending criteria.

However, banks are now so selective when choosing the sectors they want to lend to that they continue to sit on £billions of unused funding which isn’t helped by additional hurdles like added valuations, added reports, more accounting information, bigger cash stakes and so on.

Similarly, if an application for a loan has been written down on the back of an envelope or if the business plan has not been thought through then the banks will continue to sit on billions of pounds because it would be unfair to expect the banks to lend on poor applications.

So as I mention above, applying common sense may help both parties to communicate better with and increase the amount of business lending.

Now it’s time for me to plug our services! We know the commercial lenders and have been successfully arranging business finance for over 40 years. 

Business Finance is available, you just have to know where to look. Get in contact with your local director!

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Why ASC?

You already know that arranging business finance can be a tricky experience.

We appreciate that your time is precious. With our extensive knowledge of business finance available in today’s SME market we can approach the lending institutions that are right for your business finance needs. You will be saved from the frustration of endless form filling, repeated conversations with numerous lenders, and save you from having to provide each different lender stacks and stacks of information.

Our job is to remove the ever increasing number of hurdles that are put in your path, by arranging business finance or commercial finance for you in a time-saving and more efficient manner.

ASC have been established for over forty years and we have experienced more recessions and ups and downs in the economy then we care to remember. Due to our clear focus on independent businesses and entrepreneurs we have developed a track record which is envied by our competitors. You will deal directly with an experienced Director who has a strong commercial background and real experience enabling him or her to find the business finance which is just right for your business.

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