Cash is the life blood of all business so the availability of funds to fuel expansion, purchase assets or merely support cash flow during a lull is often the difference between success and failure.
Net lending is one measure of bank support. Net meaning new lending going out less loan repayments coming back into the lender. In 2018 the UK clearing banks combined managed net lending of just £525m in the SME space while relatively new kid on the block, Funding Circle managed net lending of £723m.
The cost of doing a small deal is similar to the cost of doing a large one so the clearing banks clearly find lending to larger businesses more profitable then lending to SMEs. The fact that Funding Circle has made such inroads into the market bears testimony to SMEs need for cash.
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