FPB: Banks no longer giving money freely

Date: 13th February 2012

Small businesses must look into the innovative side of the UK's finance options in order to acquire funds.

This is the view of the Forum of Private Business (FPB) after recent figures showed that the UK's five biggest banks missed the Project Merlin lending target for small firms by more than £1 billion.

Phil McCabe, an FPB spokesman, claimed that as banks are no longer giving money freely, making business owners prove they can pay back what they borrow, alternative routes are set to become more attractive.

"What [business owners] have to do when they go to a meeting with their bank manager is to be able to prove that they are credit worthy, in effect, they have to prove that they are going to pay the money back," he explained.

"There are also alternatives that are emerging to traditional banks. So they may want to explore some of those alternatives, whether that is invoice financing or whether that is some of the more innovative funding platforms that are out there."