smallbusiness.co.uk: Helping your business think big

More than two-thirds of SMEs believe that banks are failing them, according to a poll conducted by SmallBusiness.co.uk.

As many as one in four believe that the government should make the banks lend, with 21 per cent complaining that loans are off the agenda. Some 20 per cent reported that their financing has been cancelled altogether.

Alla Pashynska, owner of travel and medical tourism company Allo Travel, says she hasn’t even tried to approach the bank for a much-needed loan.

She adds: ‘The government definitely needs to do more to encourage banks to lend to small businesses. Lending money to successful SMEs operating in a niche market will help the economy to recover.’

A further one in ten respondents to the poll stated that interest rate hikes were the real problem. John Hole, owner of tile company John’s Tile Centre, says: ‘I’ve had a good relationship with my bank for the past 15 years, but in September they wrote to me to say my overdraft rate was increasing by three per cent.

‘With the hardening of our overdraft and a slowdown in business, it’s a dull picture for us. The bank is supposed to be there to support us.’

The results of the poll come as the British Bankers' Association (BBA) met with small business forums and trade minister Peter Mandelson, to pledge its commitment to British businesses.

BBA chief executive Angela Knight says: ‘We are determined to help our customers make the most of their businesses, and part of that is to ensure they have access to finance as well as independent advice and help when times are tough.

‘Businesses with good ideas need to be reassured that banks are listening and are working actively with them.’

Of the 223 SMEs polled in the SmallBusiness.co.uk poll, as many as six per cent reported that they are now going into administration.

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