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The reasons why small businesses don't want to borrow

Published 23/09/2010 00:00:00

Everybody seems shocked that lending to small businesses is "tumbling". I am not. It is clear that SMEs are being battered by lenders - look at the interest rate charges. With base rates at 0.5%, lenders are charging 3 - 4% margins (if you're lucky), some are 5 - 6% and I know of cases at 6 - 8%. This is in addition to arrangement fees of 1.5 - 2.5%. I haven't even included legal costs, valuation fees etc which may add another 3 - 4%. And don't mention EFG, because this adds a premium of 2% to your costs.

So if you can survive the assault course of restrictive lending criteria (triple stress testing, down valuation, legal queries etc) "consolidation" sounds like a sensible alternative.

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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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