CHANCELLORS CRACKDOWN ON BANKS
CHANCELLORS CRACKDOWN ON BANKS IS WELCOMED BY LEADING RECRUITMENT EXPERT
Chancellor Alistair Darling is right to put pressure on banks to give more competitive loans to small firms to kick-start the economy, according to leading recruitment expert ATA Selection.
Mr Darling called bank bosses in for a showdown at the Treasury on Monday afternoon after revealing he was extremely concerned that banks may be charging firms too much for loans.
His concerns were shared by the Federation of Small Businesses and the British Chambers of Commerce who want to see more loans made available to businesses so they can boost Britain out of the recession.
While many small and medium-sized enterprises could be taking on new work, they are failing to do so because they cannot get the bank funding required to hire in the extra resources necessary for expansion.
Andrew Hardaker, Managing Director of ATA Selection, one of the leading specialist recruitment companies in the UK, said: We have noticed that SMEs in our specialist fields engineering, manufacturing are getting the opportunities to pick up extra work.
But many are unable to expand because they cannot get the credit they need to fund the cash gap when taking on new projects and employing people to work on them
This will prolong and deepen the recession, as businesses are effectively being prevented by the banks from expanding their business and making money. This is madness.
It is extremely good news that the Chancellor is questioning the banks record on lending in the recession it is high time the banks are forced to make more funds available.
The Government needs to put pressure on the banks particularly those which were bailed out using taxpayers money.
Despite Bank of England base rates being at their lowest ever, at 0.5 per cent, many SMEs are having to pay interest at far higher rates.
The British Banking Association has insisted that total lending to small companies rose 366m in June. The Association said banks could not lend at just above the base rate, because they were charged more themselves on the wholesale money markets.