Tension For Banks And Small Firms

Business Secretary Peter Mandelson has admitted there are “tensions” between small businesses and the banks.

Leaving a meeting with bank executives, Lord Mandelson said: “What we clearly need to do – given the concerns amongst small businesses and the tenisons there are – is to create a forum to bring them together.

“So where there are issues about availability of lending and terms of lending we can thrash these out and tease out the problems,” he said.

Small businesses have made a series of complaints to the Government about the banks.

British Chambers of Commerce (BCC) said firms were finding it increasingly difficult to access funding.

“The cost of money is undoubtedly higher than it was and we see no evidence of it coming down,” said the BCC’s director general David Frost.

“Banks are charging for services that were previously

“And the idea of relationship banking is breaking down. Everything is going through regional offices and it is taking much longer to get the OK on a loan or an overdraft.”

But Lord Mandelson said there was a willingness on the part of the banks to work with the Government and small businesses.

“The banks don’t want to pull the plug unnecessarily on small businesses, of course they don’t, they want to help where they can, but the banks at the same time are facing difficult conditions of their own.

“I think the Government can play a role in securing better understanding of the issues between small businesses and the banks and that’s what we’re going to do.”

Original article: Tension For Banks And Small Firms From skynews