Small business owners throughout the UK are likely to welcome news that bank lending has begun to stabilise with increasing growing numbers of companies receiving badly needed funding.
British banks lent a whopping £564 million of loans to small firms, extending the same amount of credit as what was approved the same time last year.
The report by the British Bank Association (BBA) for September revealed that there has been no change to the number of loans being offered to small businesses when compared to the same period in 2009.
The study shows that this is the first time since 2008 that year-on-year credit figures have not slipped, which will be a major relief to UK businesses as it was originally suggested that growth had been hampered due to the banks overly cautious approach to extending credit.
In spite of promising lending figures the BBA has cautioned against an over-optimistic interpretation of the figures. David Dooks, BBA Statistics Director, commented:
“It’s too early from September’s data to say things have bottomed out. The number of new loans is more instructive than the value.”
“I would be surprised if we saw a significant increase in the number of new loans coming through this year.”