Coalition fails business on banks, says survey
British businesses have seen no changes in bank attitudes to lending to despite the Coalition's claims that it had brought the banks into line.
In February, "Project Merlin" promised to increase lending to smaller firms by £10bn to £76bn as part of a wider deal with the banks, but a survey by Hotfrog found three-quarters of firms had seen no change in attitudes.
Researchers spoke to 500 companies and found 75 per cent had seen no change in banks' attitudes to lending. Some 70 per cent of respondents said better access to funding would allow them to expand their businesses and hire more staff.
Around 41 per cent of business owners said they'd use their savings if they needed fast access to finance.
Project Merlin was signed up to by the main four High Street banks and Santander. It supposedly means that chief executives bonuses will be, in part at least, decided by how much they lend to smaller firms.
The deal also covered controlling growth in bonuses and compulsory investment in the "Big Society Bank".
The Bank of England is monitoring how the agreement is followed and is due to report shortly.
Regular readers might be suffering from deja vu: Lord Myners promised more lending to small firms back in 2008 when the multi-billion pound bank bailout was first announced. ®