Banks’ lack of common sense is slowing growth, say SMEs

08 December 2011

A survey by Shawbrook Bank, a new specialist savings and lending bank, has revealed that 89 per cent of small and medium size enterprises (SMEs) in the UK believe the country’s banks fail to use common sense when they make decisions about business loan applications.

The research demonstrates that a significant number of SMEs feel banks are failing to make it easy for them to borrow, despite continued calls for banks to lend more freely to small businesses to help them grow.

There is widespread frustration among SMEs with the way they are dealt with by banks, despite their appetite to borrow. Almost half (45 per cent) of SMEs questioned feel banks are too bureaucratic when dealing with small businesses, and only 6 per cent of SMEs questioned feel confident that banks are clear and transparent in their dealings with small business customers.

The survey of over 800 SMEs was commissioned by Shawbrook Bank, a specialist in savings and lending, which aims to make it easier and more straightforward for credit-worthy SMEs to borrow.

Shawbrook has chosen to distribute its banking products through brokers rather than using a branch network. Working with brokers and a streamlined lending process enables Shawbrook to meet the needs of many credit-worthy SMEs looking for a bank that can act quickly, efficiently and with common sense when a loan is needed.

Owen Woodley, CEO of Shawbrook Bank said:
“At a time when SMEs should be given all the help they need to grow and succeed, it’s worrying that so many feel they are up against a loan application system that is unclear and obstructive.

“Having access to the right finance at the right time is vital for an expanding small business – and so is having a straightforward and efficient lending process. It’s all very well for a bank to say the money for SMEs is there to lend, but if the process is bureaucratic and inflexible it means nothing but lost opportunities and slowed growth.

“When we created Shawbrook Bank we spent time listening to the needs of small businesses. We have chosen to operate through brokers rather than a branch network which makes us efficient and agile, and we make fast, robust decisions based on common sense and knowledge of our customers – not a computer score.”

Shawbrook Bank will offer lending and savings products to small and medium-sized businesses, and individuals. Lending to SMEs lies at the core of its business, and it is focussed on making it easier for credit-worthy SMEs to borrow in the most flexible and efficient way.