Business Lending 'deemed To Have Stabilised'

Small business lending seems to have reached a plateau, one banking organisation notes.

The borrowing activity of banks appears to have stabilised, it has been suggested.

With figures from British Bankers' Association (BBA) revealing some £573 million of new structured-term lending was issued to small firms last November, statistics director David Dooks claims that "small business demand for new loans is running below corresponding levels of a year earlier".

And with £592 million issued in October, the BBA official claims that lending to business accounts "appears to have stabilised at just under £600 million a month".

He adds that the annual drop in lending is "not surprising", as many small firms are concentrating on repaying existing debts and have put plans for investment on the backburner.

Firms considering their business credit card requirements may be interested to note his comments that structured lending to small businesses is up four per cent from a year ago.

However incorporating insurance costs into their management of UK accounts may be advisable, as Scottish Widows recently pointed out that the majority of sole traders lack cover to help protect their business should a "key" employee be unable to work.

By: Sam Gooch

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