The bank bashing season is back in full swing. Every day we read another article about banks not lending to businesses and in particular not lending to small businesses. Every other day we read in an article that whatever loans are available they are offered at extremely restrictive terms and fairly high rates of interest. Yes we can all join in and have another bash and go at banks but ultimately that does not help.
We all know that the government has pumped in £billions into the banking system and that clearly this hasn’t helped. Other solutions are therefore necessary. We have mentioned on a number of occasions that initiatives to further growth and demand in the business community would be more suitable. Simply put. If a business starts investing and another business is selling then that cash flow will multiply through the economy. So the key is to stimulate the economy and to motivate business people and entrepreneurs to look positively at the future. Complicated schemes like the National Loan Guarantee Scheme will not do the trick. The experience with the EFG confirms that. But it is not all doom and gloom because we know from our experience that business finance can be raised. With the right approach and for the right proposal there is sensible finance available.