At Last, Banks Start Business Cash Flow; Mail Campaign Pays off with Rise in Loans to Kick-Start Economy
Byline: Alan Roden and Michael Blackley
BANKS have finally started to lend money to Scotland's businesses in a bid to kick-start the economic recovery.
New figures show that 87 per cent of small and mediumsized firms have been able to access all the money they asked for this year, up from 79 per cent in 2010.
The move comes after massive pressure was placed on the banks by a campaign, led by the Scottish Daily Mail, to 'make the banks lend'. The campaign has won the support of First Minister Alex Salmond and business leaders.
Finance Secretary John Swinney last night welcomed the boost for the 'lifeblood of the Scottish economy'.
Scottish Conservative finance spokesman Gavin Brown said: 'I welcome any increase like this which helps get the country going. The national loan guarantee scheme has helped small businesses access cash they may not have been able to before. But there is more to be done and this claim that 87 per cent of businesses are getting what they want is not something I have been hearing on the ground.
'The Scottish Daily Mail's campaign has been an important driver behind this change.'
The new Scottish Government figures show that, over the last year, nine per cent of firms applied for new lending and 32 per cent wanted to renew existing facilities.
The results point to a decrease in the number of companies that were rejected by banks. However, the proportion of firms which secured none of the finance sought also increased marginally.
Mr Swinney said: 'Small and medium sized businesses (SMEs) are the lifeblood of the Scottish economy. Collectively they employ over one million people and account for around 54 per cent of total employees in Scotland's private sector.
'Any evidence of increased lending to SMEs is good news for our economy and will be a key element in building a sustained recovery. …