A report commissioned by the British Banker's Association (BBA) has revealed that banks are a lot more willing to lend than many smaller companies assume, and that failing to seek funding for fear of rejection is potentially holding a lot of small to medium enterprises (SMEs) back.
Their research found that just 37% of SMEs planning to apply for finance believe they'll have their application approved, when in reality the approval rates are closer to 67%. The survey also identified that a further 6% of businesses wanted to apply for finance but never actually ended up doing so, indicating a clear lack of confidence in the sector.
This is something that the BBA wants to change, and is why they're launching a campaign to let SMEs know that they're a lot more likely to secure bank finance than they might think. Increasing the number of companies confident about their chances of being approved for a business loan could have a knock-on effect for the entire economy, boosting their spending power and UK growth in the process.
BBA chief executive, Anthony Browne, commented on the launch: "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."
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