There are we believing that finance and credit are easing to small businesses, but the official figures tell a different story. The Financial Times this morning reports that:
"Lending to private non-financial businesses excluding securitisations, a key measure watched closedly by the Bank of England, fell by 0.1 per cent, after falling by 0.9 per cent in April.
"Business lending has fallen in seven out of the last 12 months, meaning that companies have made net repayments of loans. The three month annualised pace net lending levels fell by 3 per cent, compared to a long run average before the financial crisis began of 10.4 per cent."
Whether these grim figures are due to banks’ reluctance to lend or businesses reining in, it’s difficult to tell, says the FT. Quantitative easing, however, seems yet to be freeing up the system.
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