That is according to Aldermore chief executive Phillip Monks, who made the comments in an interview with the Daily Telegraph.
He suggested that SMEs are not denied funding because of the strength of their businesses, so it seems looking to "challenger" banks may be the best way forward.
Mr Monks told the news provider: "In this country we tend to focus on the big four or five banks and if you look at supply for SME customers it has been shrinking.
"Often SMEs find themselves refused credit, not because of the quality of their business but because the bank to whom they have applied has made a strategic decision to shrink its lending book."
Recent figures from the Bank of England (BoE) showed Aldermore among the top five lenders in the Funding for Lending Scheme, with the bank already providing finance to the tune of £2 billion since its launch in 2009.
The 2012 fourth quarter Credit Conditions Survey from the BoE also recently suggested there was a slight increase in the availability of credit for small firms in the final three months of last year.
However, with a survey from the Federation of Small Businesses finding that four in ten small companies are being denied bank loans, it seems many providers are simply not doing enough to fill the funding gap.
For SMEs seeking out finance, Aldermore could be a more favourable option to the high street as it provides tailor-made funding to suit the needs of individual businesses.
At a time when many major banks may be building up funds to meet regulatory requirements, it is worth bearing in mind that Aldermore is on hand with a number of solutions to ensure small firms can go from strength to strength.
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