I was interested to visit the new Business Banking Insight website. This initiative was announced by George Osborne in November 2013 and has just gone live. The site is designed to shine a spotlight on the performance, service and operations of a large number of High Street and Challenger lenders.
This was always going to be quite a moment for many of these much-maligned institutions.
Even in its early iteration there was some interesting insight to be delivered by the simple and effective rating system. Already the big lenders had amassed significantly more “votes” than their smaller rivals and they all seemed to fare about the same.
The early indications to support the popular perception that in fact they are all much of a muchness, seems borne out by the figures and the comments.
To be fair, it is not surprising that business owners relish the opportunity to vent. In the face of recent data (the BBA numbers showing that net business lending fell by an even larger than expected £2.3bn in April) and a continued reluctance of lenders to take on risk, there will be many disgruntled business owners wondering what to do next.
Our own initiative in this area, alternativebusinessfunding.co.uk seeks to throw some light onto this “what to do next” problem by offering a simple and transparent portal that will be of value to business owners faced with rejection from more traditional lenders.
I read a criticism of our approach recently. Someone had questioned the viability of lending to (and I paraphrase) “someone who can’t figure out what their alternatives might be on their own.”
I would argue that this is a complacent point of view, especially as recent research shows us that somewhere around 85% of businesses rejected by their primary lender do not apply again.
This is a dangerous phenomenon and one we seek to address.
If the government decides to encourage banks to refer their rejected businesses into a portal such as alternativebusinessfunding.co.uk then this will go some way to removing a powerful brake that is currently being applied to the UK economy.