“The banks could and should do more to help Fife business”
LEADER of Fife Council, Councillor Alex Rowley has called for decentralisation of banks to focus on local lending to help local economies such as Fife recover quickly from the global financial crisis.
In a letter to Vince Cable MP, secretary of State for Business, Innovation & Skills, Councillor Rowley explained the difficulties many small businesses are experiencing with their banks. He said: “I have had a number of conversations with local, small businesses about the problems they face. They range from increases in charges and reduction, or even complete loss of banking facilities, often at very short notice. This can lead to the business closing and a loss of jobs.
“Fife needs these businesses if it is to recover from the global financial crisis and return to growth so that the employment levels can return to pre-recession levels. This will not happen unless the flow of loans to small businesses stops contracting and credit starts expanding. The Bank of England’s Trends in Lending reported yet more contraction in the lending to small businesses in the Quarter to October 2012, and their recent data indicated that this Quarter will not see any material change.
“A survey of Fife businesses and four workshops with the business community last year indicated that some businesses intend to expand either through new markets or by employing more staff. Yet access to finance is a growing problem for them, getting in the way of these plans, and was an item raised at each session as a barrier to growth and new jobs.”
He concluded: “I would urge the UK Government to focus on the proposed reform of the banking system to ensure that our banks concentrate on their core functions including lending to small businesses on appropriate terms. This would boost business confidence in their likelihood of being successful.
“The banks are a public utility and should be standing up for small businesses to rebalance the banking system to support local economies such as Fife.”