LOANS made under the government’s Enterprise Finance Guarantee (EFG) plummeted in the final three months of 2012, figures revealed this morning.
EFG lending collapsed 26 per cent between the third and fourth quarters of last year, Syscap research showed, falling to £70.7m. This meant the value of loans underpinned by EFG was 9.1 per cent below where it was a year before.
The figures come after the government’s flagship Funding for Lending Scheme (FLS) has appeared to fall short of its aims, with lending to small businesses under the scheme sliding for every quarter of 2012, including a £4.5bn dip in the final three months of the year.
“We now have two major schemes aimed at getting finance to small business that are not achieving as much as was hoped,” said Syscap boss Philip White.
“In our view the schemes’ performances could be turned around by enabling a wider range of lenders to utilise them – extending the EFG scheme to leases and opening the FLS to asset finance providers that are not bank-owned,” White added.