Bank lending to SMEs falls by £3bn

Bank lending to small-to-medium enterprises (SMEs) decreased in the three months leading up to May by approximately £3 billion, the Bank of England’s Trends in Lending report has revealed.

The annual rate of growth in cash lending to UK businesses consequently remained negative as SMEs still struggle to source funding to finance their businesses despite various bank initiatives.

Smaller businesses were reporting difficulties in accessing loans, with finance seen to be more available to those with strong balance sheets and long credit histories.

John Cridland, CBI Director-General, said: “With lending levels falling and prices rising, we need immediate action to boost lending in the economy to help growth.”

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