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Business lending north-south divide revealed

Date Added: 28/11/2012  

A new report has claimed there is a regional north-south divide in business lending.

Funding Options analysed data from HSBC, Barclays, RBS, Santander and Lloyds and found that while business lending was slightly up on last year's figures, the ability of a small to medium-sized enterprise to secure a loan depends on where in the country it is based.

Companies in the north were shown to be finding that they cannot access the same breadth of providers as those that are located in the south.

Conrad Ford, managing director of Funding Options, stated that in terms of business lending, the UK is a divided nation, reports Fresh Business Thinking.

He said: "Contrary to popular belief, the big five British banks are holding their own in lending to small businesses while the much-hyped new forms of lending such as crowdfunding represent less than a tenth of one per cent of the lending market."

Mr Ford added business lenders are still claiming the biggest challenge facing small firms in the UK at the present time is accessing the advice and support needed to put together a strong application, with this described as a "matter of urgency".

He explained business lending applications are unlikely to be successful unless the firm applying for the money is able to send in a convincing argument to the bank.

Clive Lewis, head of enterprise for the Institute of Chartered Accountants in England and Wales, urged companies that are applying for loans to take their time over their application to give them the best possible chance of success.

Earlier in the week, Nationwide used its latest interim results to reveal it is set to enter the business lending market in the coming months, with the building society planning to start offering loans to small firms by 2014.

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Posted by Julie Cutts

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