Increasing the numbers of businesses confident about their chances of getting bank lending would boost UK growth, new research from BDRC Continental shows. Hundreds of thousands of businesses could expand, order more equipment or boost their spending power if they were more aware of their good prospects of getting bank finance.
The BBA is today launching a new campaign to let businesses know they are a lot more likely to get bank finance than they think. It will highlight, in particular, that while only 37% of SMEs planning to apply for finance believe they will get approval from their bank, actual approval rates are a lot higher at almost 67%.
The research identified as many as 270,000 businesses that wanted to apply for finance but never actually ended up doing so. The research from the BDRC survey identifies a lack of confidence in their chances of success as one of the key reasons for this.
Increasing confidence amongst businesses around lending has the potential to boost the UK economy, as if all of those businesses went ahead and applied for finance this could enable:
* 53,000 small and medium sized businesses expand in the UK
* 48,000 new orders for equipment
* 113,000 businesses to boost their spending power
* 16,000 companies to develop new products or significantly improve their offering to customers
Launching the new campaign BBA Chief Executive Anthony Browne said:
“We’ve launched this campaign to let businesses know that they are a lot more likely to get finance than they think.
“This matters because more successful loan applications mean more orders for equipment, more new jobs and more plans to expand.
“Small businesses are the engine room of the economy and the research we publish today shows how much stronger our recovery could be if more SMEs approached their banks for finance”.