Normally the number 180 is only of interest to darts enthusiasts. But 180 cropped up recently and it wasn’t associated with 20 pints of mild and pork scratchings.
Instead it was 180% that caught my eye as it came via the National Association of Commercial Finance Brokers’ annual survey of its members. Short-term lending among its members apparently rose 180% last year a figure that has surprised those outside the market but not any of us involved in it.
We should not be surprised that small and medium-sized firms are looking to short-term finance options given the dearth of mainstream finance available.
We are not a lender of last resort. Indeed if it is desperation time for the borrower we would be less inclined to get involved.
But with funds from major banks out of reach for huge numbers of businesses, there is little surprise demand is rising. This leaves me wondering about the firms that are not in a position to take on short-term loans?
How can they grow if they are unable to generate finance organically and find themselves sent to Coventry by the banks?
It is an important point for this government to grasp returning the UK to economic growth will need some impetus from banks. Lending targets have been set but they are modest and not being hit.
We are lending as much as possible but our funds are finite and we need injections from banks or we could see more firms going bust.