Small businesses are more likely to get loans from the bank than they think, says the British Banker’s Association (BBA) who yesterday launched a year-long marketing campaign.
Only 37% of SMEs currently believe they will get loan approval from their bank, the research shows. However, more than two thirds actually have their loan approved.
The research identified up to 270,000 small businesses that didn’t apply for finance last year because they didn’t believe they would get it. This could result in stunted growth for small businesses who often require lending from the bank to expand.
Increasing confidence around lending has the potential to boost the UK economy, the report has shown. The BBA estimate that if all businesses applied for loans when they needed to, 53,000 UK-based small and medium sized businesses would be able to expand.
113,000 businesses would boost their spending power, enabling them to considerably improve their products and services.
BBA Chief Executive Anthony Browne, who is launching the new campaign 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”.
This is good news for small businesses and SMEs, whose dreams of expansion and improvements in 2014 could now become a reality. The campaign also shows a revitalised push for new business growth in the UK, which is increasingly recognised as vital for a strengthening economy.