A survey by a business lobby group reveals that a significant proportion of small businesses feel hindered by their bank.
The Federation of Small Businesses (FSB) survey found that nearly 16% of small firms have seen an increase in bank fees in recent months, while 33% of respondents said their banks were imposing changes in their financial arrangements which would prove detrimental.
The research, which involved 6,000 FSB members, also found that a third of small firms concluded that their bank was now less helpful than before the onset of the credit crunch and almost 40% had been forced to reduce their staffing levels.
Challenges posed by banks included new lending conditions, increased charges and rates, reduced overdraft facilities and requests for more security for loans.
However, around 60% of respondents said their businesses were performing the same, or better, than last year and 78% reported that they felt customers were supporting them through difficult times.
FSB Professor of Small Business, Alistair Anderson, believes the figures “demonstrate how times are really tough for small firms and how access to finance continues to be a real challenge”.
© Crimson Business Ltd. 2009