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Darling urges banks to lend to small businesses

Chancellor Alistair Darling will today urge banks to offer more competitive rates on loans to small businesses after raising concerns that they are not lending enough.

In a meeting at the Treasury today, the Chancellor will ask lenders to reduce their rates in order to boost lending figures.

Liberal Democrat Shadow Chancellor Vince Cable says: “It is amazing that the Chancellor of the Exchequer has only just woken up to the fact that this is a problem. We have been warning about the lending crisis, including in Government-owned banks, for months.

“The problem isn’t just about the cost of borrowing, but the difficulties which many companies who are solvent, with a good credit history, have in obtaining bank credit without unreasonable demands for personal security and charges.

“It’s time the Government stopped being a passive investor in the nationalised and semi-nationalised banks and ensured that they maintain lending to good British companies for the wider interest of the national economy.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Darling/small business
    When we have a major cock up by the banks/ regulator & government causing the current crisis it seems crazy to put the above 3 in charge of sorting out the mess they created. Of course the banks aren’t lending. They are building up their capital adequacy requirements by increasing profits through borrowing from the BOE at .5% & lending at 4/5/6% + Great margins, therefore increased profits & they can award themselves bonuses again.Competition has been decreased by all the mergers. The FSA is sending out warning signals of any lending over their perceived safe limit (if they had done that a year ago I might have some agreement but now with reduced & hopefully stabalised house prices lenders security is much better ). The banks are arguing (& will probably get) for reduced qualifications for their staff. All completely balmy. Anyone with a modicum of common sense can see this but it seems self interest coupled with a totally blinkered mindset will ensure that common sense does not prevail.

  2. Criteria and lending
    Its all too easy to say lend to businesses. Darling stated that lenders still have a business to run and credit risk is down to them. That taken into account, lending can’t flow again as criteria has over tightened. The banks are just cherry picking. The saying therefore cannot be more true at the moment. ” A bank is an institution that will lend you money, if you can prove you don’t need it”. Good luck Mr Darling…

  3. Lending
    Is it just me or does Alistair Darling think that by simply calling a meeting and asking lenders to LEND that they will go out and start to do this??? what planet is this guy from? You have been asking the banks to lend for the last 6 months? why would they take this meeting seriousely now? Get off your backside Alistair and start taking some action, we have had enough of your passive approach, Manage the banks lending, follow up on the banks lending??? shall I do the job for you???

  4. show me the money
    the chimp at number 11 needs to shave his eyebrows as it seems they are getting in the way of his eye sight. this is a case of public sector wages and publiv sector standards. get get private sector ball busters in involved too save us allbefore we all end up like a bunch us chimps scraping for peanuts

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