BANKS who turn down loan requests from small businesses (SMEs) will have their decision reviewed by a rival lender, as part of a new appeals process designed to boost credit to SMEs.
The banking sector hopes the new regime will help repair its image, which has suffered the face of repeated attacks from politicians who say banks are starving SMEs of cash.
Banks claim they are lending to as many healthy SMEs as is possible but that the demand is not there, as firms undergo an often painful process of de-leveraging.
Under the new process, SMEs will learn the result of their appeal within 30 days and banks will have to offer guidance on alternative sources of finance, such as equity financing.
City A.M. Reporter