Finance

Many businesses use money from the bank, equity finance or other methods to keep their businesses innovating and growing. Over the last year, the economic downturn has made it more difficult for businesses to get the finance that they need to keep trading. Banks are less willing to lend, and where they are lending, costs of finance are higher and more security is required.

Our position

At the beginning of the economic downturn, we set up a panel of members to ‘take the temperature' of our members' credit situation. This Economic Downturn Panel has been reporting back to us monthly on the issues and trends affecting small businesses.

Partly due to pressure from the FPB, the Government has made £1.3 billion of guarantees available through its Enterprise Finance Guarantee scheme. The FPB also sits on Peter Mandelson's Small Business Finance Forum to help monitor the banks' lending to our members.

There are signs that access to finance is improving for small businesses (See Economic Downturn Panel results below). But there are still businesses struggling. That's why we continue to talk to the banks on behalf of our members to help them get the finance they need.

Latest developments

In 2 June, Phil Orford, along with representatives from the CBI and FSB, gave oral evidence to the Business and Enterprise Select Committee about the Enterprise Finance Guarantee.
On 1 May, The Treasury Committee released its report Banking Crisis - dealing with the failure of the UK banks. It expresses concerns about continued problems for small businesses in accessing the credit they need.
The findings from our Economic Downturn Panel suggest that, after six months, the money for the Government's Enterprise Finance Guarantee is starting to find those businesses that need it. By the end of April, banks have reported taken applications for nearly £325m of EFG funds from over 2900 small businesses.

Latest research

Economic Downturn Panel - click here to view all the results by month.

If you would like to share your experience with equity finance or venture capital, please email campaigns@fpb.org.

Sign up online for membership here. Alternatively, if you would like to know more, fill in our call-back form and a member of our friendly team will get in touch. You will receive a call from us by the end of the next working day, at the latest.