CASH-STRAPPED UK companies are still struggling to get bank loans, a new survey has claimed.
Almost 40 per cent of businesses surveyed said it had become harder to access bank lending over the past year, while 14 per cent believed it had worsened in the past three months.
Yet 27 per cent said their need for finance had increased over the same three months and 31 per cent were being forced to delay critical investments due to difficulty obtaining finance, the survey by business finance provider Syscap found.
Syscap chief executive Philip White said the findings were “alarming”.
“It is vital that funding streams to UK businesses are kept open,” he said.
Firms also felt loans were expensive – 73 per cent said lending margins on their loans were too high and 82 per cent felt arrangement fees were too high.
Bank of England statistics support the findings. Lending to business from the major UK banks contracted for a fifth consecutive month in July, by £2.5bn, while lending margins on new loans hit 2.28 percentage points in July, up from 2.15 in July 2009.
British Bankers’ Association chief executive Angela Knight said: “We do not believe there is any future in continuing the debate over whether banks are or are not lending.”