The Federation of Small Businesses has published a new report suggesting the decline in traditional lending means the government should be promoting alternative forms of business finance.
With overdrafts and bank loans becoming increasingly difficult to access for smaller firms in particular, as evidenced by the failure of Project Merlin to stimulate bank lending, the business organisation highlighted the role non-bank finance providers have to play whilst long-term reforms were made to the UK's banking system.
FSB national chairman, John Walker, said: "We need to accept that in its current form, our banking structure might never fully cater to the needs of the UK's business community. We need to build alternative routes that connect savers and investors with viable small businesses ... and thereby introduce innovation and competition into the sector."
With overdrafts and bank loans becoming increasingly difficult to access for smaller firms in particular, as evidenced by the failure of Project Merlin to stimulate bank lending, the business organisation highlighted the role non-bank finance providers have to play whilst long-term reforms were made to the UK's banking system.
FSB national chairman, John Walker, said: "We need to accept that in its current form, our banking structure might never fully cater to the needs of the UK's business community. We need to build alternative routes that connect savers and investors with viable small businesses ... and thereby introduce innovation and competition into the sector."
