A call by coalition leader David Cameron for
banks to increase lending to SMEs has been welcomed by the FLA and
by UK lessors Lombard and Lloyds TSB Commercial Finance.
Lombard, owned by Royal Bank of Scotland,
which was bailed out by the taxpayer during the financial crisis,
has affirmed its commitment to SME lending.
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Alexander Baldock, Lombard managing director,
said: “We see plenty of opportunity to profitably fund SMEs. We are
happy to play our part to fulfil government aspirations.”
Coalition leader David Cameron told delegates
at the CBI conference 2010: “To build that new dynamism in our
economy . . . means opening up access to finance, creating an
attractive environment for venture capital funding, getting banks
lending to small businesses again.”
Lombard is expected to lend more to SMEs this
year than last year, and will lend more again in 2011. “There is
something special about SMEs, they are invested in their business,
emotionally as well as financially. Capital expenditure is their
lifeblood and we are cap ex funders,” Baldock said.
Lloyds TSB Commercial Finance, owned by Lloyds
Banking Group, has also reiterated its commitment to SMEs.
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By GlobalDataHead of marketing and external affairs Ian
Byers said: “We are committed to funding SMEs, the lifeblood of the
economy, and support any initiative that encourages the growth of
small businesses.
“We recognise that time is often of the
essence when it comes to small business funding and our Client
Charter promises to give our prospective clients with a turnover of
up to £15m an indicative lending decision within 48 hours.”
Stephen Sklaroff, director general of the FLA,
also welcomed the focus on funding for SMEs.
He said: “Government has recognised the
importance of asset finance for small business. We are now talks to
find out what can be done to eliminate unnecessary barriers to
lending. One is lack of knowledge among SMEs, not knowing there are
thousands of places to get asset finance. We are discussing
creating a guide to asset finance for SME.”
The FLA’s other concern is the complexity of
the tax regime, and the way in which it creates a bias in favour of
outright purchase. “The tax regime shouldn’t bias an investment
decision in that way. And the complexity – it puts small business
off,” Sklaroff said.
The organisation is urging government to take
the opportunity for change presented by the proposed new accounting
rules to reduce complexity and rebalance the playing field between
asset finance and outright purchase.
