• British banks and building societies drew down £2.0bn in Q1 2014 from the Funding for Lending Scheme.
  • Net lending to businesses fell by £2.7bn in Q1 2014. lending to SMEs fell by £723m

Commenting on the Funding for Lending figures, published by the Bank of England today, John Longworth, Director General of the British Chambers of Commerce (BCC), said:

“It is concerning that lending to firms across the country has continued to contract even though the Funding for Lending scheme has been re-focussed towards business lending. This provides further evidence that Britain’s business finance system remains broken.

“Although more established firms have little difficulty in accessing the finance they need, the litmus test for the Funding for Lending scheme has always been whether young and fast-growing businesses are able to get the finance they need to expand and drive the recovery, and unfortunately many of these firms remain frozen out of the market.

“More must be done to fill this major gap in the provision of business finance, which means increasing the role of equity and bond issues, and delivering a Business Bank with greater scale and ambition than outlined in current proposals.”