Demand and Finance remain greatest issues for UK businesses

Access to finance remains a serious problem for British businesses, despite the Bank of England pumping £200 billion into the economy to boost money supply and stimulate lending.

In the latest Monthly Business Survey, published today by the British Chambers of Commerce, 33% of companies reported that accessing finance had been more difficult over the last three months. This compares with the same question asked in June, when 20% of businesses believed access to finance had worsened.

Furthermore, the number of firms reporting an improved access to finance situation fell – dropping from 6% in June, to just 3% in the latest survey.

Despite the results pointing towards continued lending constraints, of the 400 businesses questioned, 64% said that their biggest barrier to growth over the next 12 months was a lack of customer demand.

Commenting, David Frost, Director General of the British Chambers of Commerce, said:

“Our latest survey results show that the biggest issue facing British businesses is still demand for products and services. This means that any economic recovery is still fragile.”

Mr Frost added: “It is clear that the huge sums that have been injected into the financial system by quantitative easing are still not reaching small and medium-sized businesses in anything like the scale required for business to invest for future success.”