Credit restrictions on SMEs harming business growth
Despite the Royal Bank of Scotland and HSBC setting aside billions of pounds for business loans, the Office for National Statistics has confirmed that the current recession in the UK is caused by a lack of credit available to SMEs.
With empty shops lining high streets, the number of firms going bust on the rise, and further quantitative easing to the tune of £50 billion confirmed by the Bank of England, experts are now stressing the need for more to be done to support start-up businesses.
It isn’t all doom and gloom, however – as mentioned before, RBS are beginning to do more for small businesses, and this has included a reduction in overall interest rates levied to companies who borrow money from the bank. With a 1.6% cut in the cost of borrowing for entrepreneurs, this is likely to boost cash flow, and potentially aid expansion. SMEs are expected to save more than £40 billion following the move.
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