Lending to SMEs (small-and-medium enterprises) in the UK that have taken advantage of the Bank of England’s Funding for Lending Scheme (FLS) has risen in the period from 1st April 2015 to 30th June 2015. In this period, lending increased by £490 million. This follows a net rise in lending of £648 million in Q1 of 2015 to this important sector.
The Funding for Lending Scheme was launched back in July 2012 jointly by HM Treasury and the Bank of England and appears to be a success. It provided an incentive to banks and building societies in the UK to financially support SMEs in so much as for every £1 banks advanced to SMEs the Bank of England will lend the banks £5. To date, a total of £61.4 billion has been provided by banks and building societies.
Lloyds Banking Group was the biggest net lender at £527 million in quarter 2 of 2015. Nationwide Building Society saw the biggest decline in lending to this sector with a drop of £279 million in the same period.
Could one of the reasons for greater lending being made available in the UK be due to a relaxation in credit conditions? There would also appear to be increased confidence in the business community about the economy here in the UK. Let us hope that this confidence continues into the future possibly resulting in a number of these SMEs growing to become large corporations.
Of course, there are numerous sources of lending to the small and medium sized business sector here in the UK so it is certainly worth shopping around to try to obtain the most competitive lending package to meet your requirements. In this respect, why not take advantage of the service provided by Connect Commercial Finance as we provide you with access to a specialist advisor who can help source the most suitable business lending product to meet your requirements.
There are a huge number of people in the UK who are reaching retirement age but finding that their retirement income together with any savings are insufficient to enable them to maintain a reasonable standard of living. One option open to a homeowner may be to arrange to raise funds by way of an Equity Release scheme.
Apparently, the Financial Conduct Authority (FCA) is going to be looking into how Equity Release schemes can be used more for the benefit of the ageing population as part of a review of the mortgage industry. For instance, could more people release some of the capital in their property as a lump sum or receive a gradual income through the equity in their homes? The review is due to commence in the early part of 2016.
Equity Release schemes are relatively straightforward lending products that have become increasingly popular amongst retired people in recent years. If someone owns their property outright and is a minimum age of 55/60 then they may be able to borrow money against the security of their home and use the money to provide additional financial support in retirement.
The two most common types of Equity Release schemes for the elderly are a lifetime mortgage and a home reversion plan. The former involves borrowing money against how much the house is worth and the other is where either all or a part of the property is sold to a home reversion company who provide the occupant with a tax-free lump sum.
Interest is added to the amount borrowed that is repaid once the property is sold typically following the death of the homeowner. Obviously, the amount of interest will accrue and could, along with the capital raised, potentially be a significant sum by the time the property is sold. You may wish to obtain advice about such schemes before considering entering into one.
The Start Up Loans Company started operating in September 2012 with the intention of providing loans at a reasonable rate of interest to businesses that have been established for no more than 2 years. Entrepreneurs are helped by a business adviser to complete a business plan and submit a loan application. Following drawdown of the loan a mentor will provide advice and guidance to owners to help grow the business.
Business loans are available for anything up to £25,000 and are repayable over 1 to 5 years. The interest rate is presently fixed at 6% per annum and there are no fees payable. Credit reference searches are undertaken but just because someone has a poor credit history does not necessarily mean that their application will be declined.
You may be interested to read that through the Start Up Loans Company the amount lent so far is £165,598, 349. Some 31,264 businesses have received financial support in this way. In total, 29 businesses have received funding each day. Of the applicants, 62% were male and 38% were female. The average amount of each business loan was £5,297. When looking at the age of business owners, 21% were in the 18 to 24 year age bracket, 32% were aged between 25 to 30, 37% were 31 to 49 years of age and 10% were 50 years of age or over. Interestingly, some 46% were unemployed before applying for a loan.
Obviously, finance has been provided to so many different types of business including the Cornwall Camper Company that restores and then rents out high-end VW Camper vans, the Yorkshire Meatball Company based in Harrogate who make and sell meatballs in their restaurant, Sturdy Cycles in Powys,Wales that build and sell quality bicycles, Bluebird Tea that sells loose leaf tea in Brighton and ShortCuts that is a child-friendly hair salon located near Milton Keynes where children can go and enjoy the experience of having their hair cut.