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Business lending 'stifling growth'

Date Added: 03/10/2011  

The business lending situation may be causing problems for small companies in East Anglia, which could be facing a winding up order as a result of financial problems.

Robin Twigge, chairman of the East Anglia region of the Federation of Small Businesses (FSB), stated that backroom staff are too often responsible for approving or declining applications for loans from companies in need of a little financial help.

Mr Twigge, who runs The Swan Hotel in Harleston, told the Eastern Daily Press that more common sense is required in order to improve the current business lending situation.

He said: "There should be more of an entrepreneurial approach to small businesses and their projects."

The FSB representative also pointed out that the number of companies going into liquidation will rise unless there is a change in business lending that allows them to access more finance from Britain's banks, which are committed to approving more loans through the Project Merlin scheme, although it is debatable whether or not the programme has been a success.

Norman Reece, who runs commercial catering equipment warehouse Norman's Services, added that a locally-based manager should be installed at banks in order to give smaller firms more chance of having their applications for business lending approved.

"I cannot even afford to employ anybody. I work seven days a week. I do not have the finance available to be able to do that." the entrepreneur was quoted as saying by the news provider.

Martin Lake, Norfolk FSB chairman, stated that it appears any link between bank managers and the local business community has disappeared, highlighting the fact that there used to be social interaction such as playing golf between the two groups.

Business secretary Vince Cable was recently quoted by Reuters as saying he will not be founding a new bank to boost business lending, as it would take around two years and the current situation is "urgent".

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Posted by Miles Pritchard

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