Small firms ‘are struggling to get loans’

Small businesses are in need of funding but struggling to get loans from high street banks, a new survey has found.

Three-fifths of small and medium-sized enterprises (SMES) said that they currently need funding to ease day-to-day cashflow issues, according to research by asset manager Channel Capital.

And more than two-thirds of SMES reported that they need funding to grow.

With around 5.6 million SMES in the UK, that means that about 3.3m need to access finance to help them stay afloat during an extremely challenging time for businesses, Channel Capital said.

But business owners are facing roadblocks when it comes to receiving loans because of a reluctance among high street banks to lend to smaller firms, the survey found.

Over half of the more than 500 business leaders surveyed said that they think high street banks are too slow in assessing business loan applications, and just under half felt they are reticent to lend to smaller businesses.