Executives from the UK’s largest banks have teamed up to help increase lending to small businesses, and help them recover faster.
Stephen Green, chairman of the HSBC and the British Banker’s Association, is captain of them team. The task force aims to examine proposals within the industry and deliver solutions to stimulate lending.
Green wrote the chancellor over the weekend, and said in a letter: “We believe there is a real need to make sure that viable businesses are able to obtain the finance they need to support the recovery of the UK economy. A variety of factors have an impact on this and we recognise the collective role we have to play.”
In addition to assessing proposals from within the industry for possible solutions, the team will evaluate some of the potential barriers to securing funds the businesses have dealt with up to now.
The team has been formed primarily due to the fact that the businesses are not obtaining finance they need to pull themselves out of recession status.
Banks have stood behind what they believe the root of the problem is; a lack of demand for credit as businesses have scaled back.
But small and medium sized businesses claim a much different basis for the problem, saying they are still struggling to obtain credit from the banks. The Federation of Small Businesses even argues that if credit is available, the terms are still unattractive.
Bank executives other than Green will come from Barclays, Lloyds, Santander, RBS and Standard Chartered. Representatives of the Treasury, the Bank of England and the Department of Business, Innovation and Skills will also contribute to the effort.