Small businesses say banks won't be persuaded to lend
Seventy per cent of small and medium sized businesses based in the West Midlands believe the government will be unable to persuade banks to increase lending. That’s according to a survey by financial advisor Anderson Locke.
More than half of respondents said they believed they would be unable to obtain additional bank funding, despite 60 per cent of businesses reporting facing tougher trading conditions in 2010 compared with last year.
Neil Wadsworth, principal of Anderson Locke, said: “The region’s small businesses are in a catch-22. They require financing to fund investment that will boost their competitiveness, but banks are very risk averse when it comes to SMEs, particularly in what are traditionally core regional sectors like property, construction, manufacturing and engineering.”
“This inability to access bank funding will have repercussions once the government spending cuts come into force, especially given that recent research has cast doubt on the region’s resilience in the face of the cuts.”
Fifty one per cent of respondents said that they believed the proposed spending cuts would have a detrimental impact on their business, and a further 13 per cent reported that they were “unsure” as to how they will be affected.
The Anderson Locke survey polled executives at 99 small and medium sized businesses in the West Midlands, across a range of sectors, including finance, manufacturing and engineering, media and marketing, property and construction, recruitment and training, retail and leisure, ICT and law.
