Banks must 'open credit channels' to stem unemployment

Date: 22nd January 2009

Struggling small businesses are urging banks to resume normal lending practises on the back of the latest UK employment statistics.

The Office for National Statistics' latest labour market data shows that unemployment has risen by more than 130,000 over the previous three months, causing small firms - including sole traders and partnerships - to call for action.

According to the British Chambers of Commerce (BCC), it is now up to the government to ensure that lenders provide small businesses with the necessary finance to survive the recession.

Director general of the BCC, David Frost, commented: "Even with some staff accepting pay freezes and working fewer hours, it's clear that employers are facing serious financial pressures."

He added that unless banks began "behaving more responsibly" and opening credit channels, finance would continue to be a problem for businesses.

Another pressing matter for small businesses is the upcoming deadline for self-assessment tax returns, with all submissions being due online by January 31st.