The latest Bank of England Credit Conditions Survey made for stark reading, as it raised the prospect of the steepest fall in bank lending to SMEs since the financial crisis a decade ago.
As a consequence of increasing defaults during the third quarter, banks plan to reduce their fourth-quarter business lending. With SMEs already facing a £22 billion funding gap, there is an obvious threat to growth.
With many SMEs reliant on borrowing to fund growth, the Bank of England survey will raise concerns that companies will be unable to invest if they are cannot secure credit.
These latest figures show that the number of lenders expecting to reduce access to business credit over the remainder of 2019 is now 13.5% higher than those offering easier access to loans. If this prediction becomes reality, then the fourth quarter will see the most pronounced drop in business lending by banks since 2008.
As banks reduce their lending to SMEs, alternative finance providers stand ready to fill the £22 billion SME funding gap that Bank of England governor Mark Carney highlighted in his annual Mansion House speech.
LendingCrowd, the only fintech lending platform headquartered in Scotland, has been funding the ambitions of SMEs since 2014. Providing a fast, flexible funding option, we have already delivered more than £67 million in lending to over 700 businesses from Peterhead to Peterborough.
We were recently named Scotland’s High Growth Business of the Year in the British Chambers of Commerce annual awards and lifted the trophy for Best P2P Business Lender at the inaugural Growth Finance Awards.
In addition, we have signed a strategic partnership with the Institute of Chartered Accountants of Scotland (ICAS), which means that ICAS members will be able to access funding for their clients at a discounted fee.
To find out how LendingCrowd can fund ambitions and support the growth of our vital community of SMEs, Think Outside The Bank and get in touch today.
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