2012 marked a significant year in the fight to address the lack of funding for SMEs, with the launch of the Funding for Lending Scheme in July bringing hope for many small businesses. Indeed, as the sixth largest net lender in the scheme, the FLS has allowed Aldermore to expand SME lending by 75% in 2012.
Despite this significant progress though, many debate whether the scheme has had a large impact on boosting lending to small businesses. Bank of England figures show overall business lending fell by £4.8 billion in the three months to February 2013, leading to calls for the government to reassess policy in the new parliamentary year.
In response to this criticism, Business Secretary Vince Cable announced a one year extension of the FLS in late April, introducing additional measures to encourage lending to small businesses in particular. Aldermore welcomed this change and, as a result, anticipates growing its lending book even further.
Elsewhere, many firms may see the government's much anticipated Business Bank as a more viable solution to the funding problem. Set to begin allocating credit this Autumn, small business owners have been advised to submit applications by 22nd May to obtain their share of the Bank's initial £300 million funding pot.
This state-run banking venture intends to raise the level of competition within the banking sector, free from the under-capitalisation issues that many of the high-street banks have been left with in the wake of the financial crisis.
Having made it our mission to shake up the stagnant British banking sector, Aldermore are glad to see the government taking crucial steps to better serve the financial needs of SMEs and will continue to work alongside the government to support this community.
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