New Lending to Small Businesses Increased by £23m, Finds BBA
New lending to UK small businesses of £534m in January followed a seasonally low total of £511m in December, according to the British Bankers’ Association (BBA).
A rise in overdraft lending in January was consistent with a similar rise a year earlier. A significant fall in deposits was partly a reaction to an unusual large rise in
December (as businesses retained cash), and partly the usual fall seen at the start of a year.
BBA statistics director, David Dooks, said: “The start of this year saw the monthly value of new lending remain above £500m a month. Lending to this particular part of the business sector has grown by 2% over the last year, even with the winter months seeing the usual lower demand for bank finance and comparisons with the same time a year ago showing relatively weaker lending. Trading conditions for small businesses continue to be difficult, but after December’s seasonal low number of new relationships, it is encouraging to see small businesses opening bank accounts in similar numbers to previous months”.
Small businesses are defined as those commercial businesses with an annual bank account debit turnover of up to £1m.