Osborne faces pressure to help SMEs

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George Osborne is expected to announce extra funding for small and medium-sized enterprises (SMEs) as he faces growing pressure over his austerity programme.

The Funding for Lending scheme was due to expire in January 2014 but as the chancellor seeks to respond to calls for a softening of government policies, he is expected to announce the boost to kick-start growth.

High street banks are to be given added incentives to extend credit to SMEs as figures highlight a decrease in the amount of lending to new businesses despite providers being offered cheap loans to pass on to customers.

The scheme has so far been criticised because Bank of England figures show lending was less in the second half of 2012 than in the previous six months.

As the economy remains sluggish and businesses are fighting to survive, a boost in lending is most certainly welcome. However, perhaps more also has to be done to encourage SMEs to visit their bank and take part in the scheme.


Posted by the Secret Businessman