Local banks 'should support small firms'
Mar 06 2009
Local bank branches should have more say in financial decisions concerning small firms, it has been suggested.
The Federation of Small Businesses (FSB) suggests that local banks should have their decision-making powers restored, as a poll of the organisation's members finds they want a better relationship with their branch managers.
A survey of more than 500 firms reveals 54 per cent prefer to communicate with the bank in person rather than by letter, email or phone, with 86 per cent favouring local rather central decision making.
John Wright, national chairman of the FSB, says: 'With 120 businesses going bust a day, business owners do not have the time to wait for letters or phone call centres to enquire about finance.'
He calls on banks to train their staff to understand the needs of small companies and recommends they adopt more realistic terms for finance applications.
The FSB also launched a range of principles for banks to follow to help smaller companies, such as fixing costs on loans and overdrafts, passing on interest rate cuts and taking part in the European Investment Bank lending programme, alongside the government's Enterprise Finance Guarantee scheme.
Earlier this week, the Confederation of British Industry claimed access to credit is still one of the main problems affecting UK businesses, with 60 per cent saying ts availability had declined in the last three months.
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