3rd March 2016

Bank support for SMEs – 4th Quarter 2015

Commenting on the latest BBA figures, Mike Conroy, Managing Director, Business Finance said:

“Net lending to SMEs of £2bn last year was the first positive annual figure in this data series, despite applications for loans and overdrafts being lower than in 2014. While alternative products such as leasing and invoice discounting are playing an increasing part for SMEs, the fact that their deposits are growing by 7% annually means that the need for external finance has been lessened. However, for those SMEs seeking loans or overdrafts, more than 8 in every 10 applications are approved, so the fact that more than £6bn of new lending was approved quarterly last year and that there was positive net lending across 2015 are encouraging signs.”

Key points:

  • 2015’s net lending to SMEs of £2.1bn was the first annual rise since this data series began in 2011.
  • Cash holdings rose by 7% in 2015, such that deposits exceed borrowing by more than £60 billion.
  • Finance applications are approved for 8 in 10 smaller businesses and 9 in 10 medium businesses.
  • The number of applications from SMEs slowed in 2015, by 13% for loans and by 9% for overdrafts, compared to 2014.