Royal Bank of Scotland is not doing enough to increase lending to small and medium-sized companies, according to business secretary Vince Cable.
According to the Times , Cable yesterday said RBS and Lloyds Banking Group need to take more responsibility for the economic recovery by helping companies grow. He reportedly said one bank is “trying a bit harder than the other”.
The Times says Cable was referring to Lloyds. Chief executive Antonio Horta-Osorio has recently given assurances the bank will increase its lending.
Speaking at the CBI conference on alternative sources of finance, Cable said: “It is not that the banks are refusing credit. It is just that the conditions are so onerous and so extremely risk-averse that it is very, very difficult for many good companies to expand.”
Cable said while SME’s report difficulty in accessing funding, banks say there is no appetite for loans, indicating a “disconnect” between the two.
He said: “There is a massive disconnect between that and what I get every time I go out of London and meet business people, who tell me that they just cannot get this money, or if they do get it it is on impossible conditions.”