Support for small businesses Q2 2007
Latest BBA figures show the level of financial support for small businesses and the growing use of online banking.
- Term lending stands at £38.5bn, having grown 8% over the year. Overdraft borrowing totals £8.9bn, a fall of 2% over the year, reflecting a lower need for temporary, cash flow finance.
- Deposits total £47.4bn, an increase of 7% over the year.
- During the last year, over 598,000 small businesses have established new banking relationships.
- 46% of small businesses operate their accounts online.
Commenting on the figures, BBA director of statistics, David Dooks, said:
"With some 50,000 small businesses starting new banking relationships each month, the number of firms served by business banks continues to grow significantly. Bank lending and customer deposits have both expanded by around 6% over the past year and now are now almost exactly in balance, reflecting strong support from banks and healthy liquidity on the part of customers. Property, IT and professional services sectors together account for the biggest proportion of lending and funds."
For further information, please contact:
Brian Capon, Head of media relations (020 7216 8810 )
David Dooks, Director of Statistics (020 7216 8837 )
Notes to Editors
1. The BBA is the leading UK banking and financial services trade association and acts on behalf of its members on domestic and international issues. Our members, from 60 different countries, collectively provide the full range of banking and financial services. They operate some 130 million personal accounts, contribute £50bn to the economy, and together make up the world's largest international banking centre.
2. Although clubs, charities and societies operate small business accounts with banks, their activities are not commercial in nature and are therefore not covered by these data.
3. In recent years, the proportion of borrowing on overdraft by small businesses has declined. Term loans are more prevalent, with well over three-quarters of term lending having a maturity of more than three years, with interest charged on a variable rate basis.
4. Small businesses are defined here as those commercial businesses with an annual bank account turnover of £1 million or less.
5. Individual banks contributing to this survey are Abbey, Alliance & Leicester Commercial Bank, Bank of Scotland, Barclays, Clydesdale (inc Yorkshire Bank), HSBC, LloydsTSB, Royal Bank of Scotland (inc NatWest) and The Co-operative Bank.
6. The Statistics section of the BBA website provides information on bank support for small businesses, whilst the Policy Issues section contains a Small Business area, dedicated to providing practical help and advice for small businesses, including a business account finder.
7. Previously released data may have been revised, as in the table below. Changes are adjusted where appropriate to remove the effects of reporting base changes, thus reflecting underlying business movements. Given the seasonal nature of support throughout a year, comparable figures for the same quarter a year earlier are shown.