Bank of England credit conditions survey is another indicator that SMEs have growth on their minds
Commenting on the Bank of England’s latest credit conditions survey (BOE figs) Nick Dodd, debt advisory director at KPMG, who advises companies on their lending arrangements, commented:
"The latest findings show an increasing demand for finance from SMEs, which is a consequence of the economy improving and more businesses looking to fund growth through increased capital expenditure and working capital investment programmes.
"Generally speaking we are seeing more liquidity and availability of credit for good quality borrowers then we have for a while with demand from lenders driving a tightening of pricing and general relaxation of terms due to strong competition.
“However, this does not necessarily mean that it has become easy to access finance across the board. We have seen businesses which are able to articulate a strong and compelling proposition proving attractive to lenders across the bank market. Conversely, companies, particularly at the smaller end, that might lack experience in engaging with lenders may struggle. ?
"We are starting to see an increase in transactional activity which is taking up some slack in the supply of credit but not yet making a real impact on overall availability. There are SME borrowers which continue to find it hard to access funding outside of the traditional high street bank model, and are not familiar with the emerging alternative lenders. This could well change, however, as these alternative providers build their own brands in the market place and customers become more aware that the traditional banks are not the only funding option available to them."
