Borrowing for the right reasons
EWM has recently received heartening news from Santander Corporate Banking…Three out of four businesses in the UK are now confident about their prospects for the next six months.
During the month of August, the bank undertook research among over 1,000 SMEs which concluded that one in seven UK businesses (15%) are looking to increase their borrowing as business confidence begins to pick up.
“Of course, they want to borrow!” I hear you cry. But wait…The most interesting aspect of the research showed that twice as many companies want to borrow to expand their business versus those that need increased funds to keep their companies afloat…Surely a positive sign for us all. Indeed, the research demonstrated that, in general, the wholesale market was at the top end of this confidence scale, with 20% of wholesale firms and 19% of construction and building services companies wanting extra funding for expansion.
Commenting on these figures, Steve Pateman, head of Santander Corporate Banking, said: “It is encouraging that increased confidence amongst UK businesses is feeding through to borrowing needs, and while it is arguable whether we are seeing any significant market recovery, it is striking that twice as many want to borrow to expand, rather than just to survive.
“The economic downturn has focused minds and businesses have adjusted accordingly. It is up to banks to adjust as well and for the role of banking in the UK economy to be redefined. We are committed to building strong relationships based on an understanding of the business and its needs, before providing them with solutions and services that fit their individual requirements.
Banks need to focus on customer relationships and taking prudent and sensible commercial risks.”
Do the Santander borrowing figures reflect your own views? I would be interested to know more about your confidence levels. E-mail me now. suzanne.gill@imlgroup.co.uk
Suzanne Gill
Editor