Business Finance – Nearly 60% of UK businesses were refused credit by their banks last year

In a recent survey by the Institute of Directors nearly 60% of businesses seeking bank finance in 2009/10 were rejected by their bank, and that 20% are financing their businesses to some extent with Credit Cards.

The overall picture of finance being accessed by businesses has also changed over the past few years. IoD data from 2001 showed that 45% of IoD members were financing their businesses through bank loans and 40% through overdrafts. Today, only 28% are doing so via bank loans, 36% through overdrafts with a further 20% financing their business to some degree through credit cards.

Enable Business Finance would agree that there is a large gap between what the traditional banks are saying they are lending to actual what’s actually happening within the small to medium enterprise market.

It would appear that despite all the noise about banks lending to businesses its still not actually happening.