Commenting on new figures from the Bank of England which show that net lending to small and medium sized businesses fell by £435m in the second quarter of 2014, Iain Moffatt, UK head of regions for KPMG, said:
“It’s clearly disappointing that lending to SMEs has continued to contract in Q2, particularly as these figures coincide with a separate report out today which suggests that success rates on applications for loans from small businesses are at a three-year low.
“Both of these trends somewhat contradict the enormous growth in business confidence that we have seen amongst the engine room of the UK. Whilst we are in a lot of cases seeing smaller companies able to finance their growth plans via cash that they have retained within their business over the last couple of years, one wonders how long this can be sustained. Increased bank lending will likely have an important part to play if we are to ensure the economy continues on its path of steady growth.”
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KPMG LLP, a UK Ltd liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with approximately 11,500 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2013. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 155,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.