Short Term Business Loans – The Governments Funding for Lending Scheme

Running a small business requires funding, if it is to be successful. Traditionally the high street banks have been the first port of call for business funding and this is why, the Government’s Funding for Lending Scheme (FLS) has been diverted from residential lending to business lending. The idea being to help businesses get vital funding to grow them, and intern the economy. Unfortunately, the banks are letting down SME’s again, with lending to businesses through the scheme falling not increasing.
The official figures released 9.9.14; show that short term business loans to small and medium-sized enterprises via the FLS fell by £435m in the second quarter of 2014. It isn’t as bad as the first quarter where lending to SMEs dropped by £723m – but it’s still a significant and disappointing shortfall. Most are now questioning if the scheme is working and whether the banks unnecessary red tape is stifling lending.
The purpose was to stimulate funding to businesses, which has been seriously lacking since the financial crisis hit. It was hoped that lending activity would have really started to increase when the FLS was restricted to business lending, with no lending to the residential sector, at the start of the year.
However, the truth is banks are still afraid to lend to start up businesses and young growing businesses, which are the lifeblood of our countries economy.
It’s strange that the government has made so much money available to high street lenders for SME’s, but it’s not reaching those that deserve or that need it. However, in contrast lenders such as @Pledge have seen 1000% growth in short term business loans lending to small businesses since the beginning of 2014.
Marcus Reeder CEO comments, “ We are receiving more and more applications for loans from frustrated business owners every day. Many have cast iron business deals that need short term funding, but have been turned down by the high street banks. We offer these customers a fast loan facility and make the funds available, when they need them. We have numerous customers that have used short term funds from us, and say they will never use a traditional bank again.”
Small lenders such as @Pledge are keen to help SMEs, maybe the Government should make the FLS available to them, as it would appear they could teach the big banks a thing or two when it comes to lending, as it’s obviously working for them and their customers.
If you are a small business and are interested in one of our quick short term business loans with no credit checks, fill out our contact form and we will get back to you or call us on: 01604 901101